Getting Ready for MAJIK Visual Manufacturing: How to Benchmark your OEE
Benchmarking Overall Equipment Effectiveness (OEE) before undergoing a digital transformation using MAJiK’s Visual Manufacturing Software Suite is important because it provides a baseline of your factory's current performance. This baseline can be used to evaluate the success of your initiative by comparing your factory's OEE before and after the implementation of new digital tools and technologies with MAJiK Systems.
In addition, benchmarking OEE can help identify areas of improvement for your factory's current operations, which can help guide your MAJiK implementation. For example, if your factory's OEE is low due to frequent equipment downtime, focusing on implementing Maintenance Connect or Downtime Tracking using Visual Factory should likely be our top priority when starting to work together.
Furthermore, benchmarking OEE can help set realistic targets and goals for the digital transformation. By understanding your current performance levels and identifying areas of improvement, your factory can set achievable goals for OEE improvements after the implementation of MAJiK’s digital manufacturing tools and technologies.
Overall, benchmarking OEE before undergoing a digital transformation is a crucial step in ensuring that the implementation of new digital tools and technologies will be successful in improving the factory's performance.
Looking to get started? Here are some instructions on how to benchmark OEE if you don’t have a real-time production monitoring or downtime tracking system:
Determine the time period for data collection - The first step in benchmarking your OEE is to determine the time period you are going to collect your data over. Ideally, you should collect data for at least one week to get an accurate picture of your factory's performance.
Collect data on machine uptime and downtime - During the data collection period, keep track of the amount of time that each machine is running (uptime) and the amount of time that it is not running (downtime). You can do this manually by getting a Process Engineer to use a stopwatch or timer, or by getting your Equipment Operators to record the start and stop times for each machine on a clipboard or in a spreadsheet.
Collect data on production output and quality - Also during the data collection period, keep track of the total number of parts produced and the number of defective parts produced. This will allow you to calculate the production output and quality metrics needed for your OEE calculation.
Record data for each key piece of equipment in your process - If you are tight on resources, you could just focus on your Bottleneck Equipment (see our future blog post on determining your Bottleneck Equipment), or you could use one piece of equipment per Equipment Group that performs the same purpose as a benchmark for the rest of your equipment.
Calculate OEE - Once you have collected the data, you can calculate OEE for each piece of equipment using the formula: OEE = Availability x Performance x Quality. To calculate each of these components, use the following formulas:
Availability: Availability = (Total Run Time - Downtime) / Total Run Time
Performance: Performance = (Total Parts Produced / Ideal Cycle Time) / Total Run Time
Quality: Quality = Good Parts / Total Parts Produced
6. Average your OEE across processes - To get the average OEE for your factory, you can complete a simple average of the OEE calculated for your different Equipment and Processes. If you want a more fine-tuned result, calculate total Availability, Performance, and Quality across your entire factory before multiplying together to calculate OEE
7. Interpret the results - Once you have calculated OEE for your factory, interpret the results to identify areas of improvement. A score of 60% or above is generally considered good, but your specific target will depend on your industry, your specific factory processes, and how far along you are in your digital manufacturing journey.
Keep in mind that this manual data collection and OEE calculation can be time-consuming and prone to error. We only recommend doing this for a little while before taking the plunge and “autonomating” you data collection and reporting.
Also remember that while it is great to have benchmarks, you need to keep two important points in perspective:
“Comparison is the thief of joy” - You shouldn’t use OEE to regularly compare yourself to other factories. It should only be used to compare your current state against your past performance. If you are getting better every week/month, you are doing things right!
“What gets measured gets managed” - OEE is a great benchmarking and diagnosis tool, but having a high OEE shouldn’t become the goal of your factory. That should come naturally by diving into the root causes of what is holding down your Availability, Performance, and Quality, and putting checks, measures, and processes in place to fix your issues. That’s how you will know you are doing continuous improvement right!