OEE

OEE, or Overall Equipment Effectiveness, is a standard metric used to measure how effectively a manufacturing operation uses its equipment. It combines three factors: availability, performance, and quality. Availability is the ratio of operating time to planned production time, where operating time excludes planned downtime. Performance compares the actual output with the potential output during operating time, reflecting speed losses. Quality measures the proportion of good units produced out of total units produced, accounting for scrap and rework. OEE is the product of these three factors: OEE = Availability × Performance × Quality, usually expressed as a percentage.

Data for OEE is collected from production logs, sensors, or enterprise systems and is typically tracked by line, machine, or shift. The metric helps identify losses in three categories: downtime, reduced speed, and quality defects, with startups and changeovers often treated as separate loss subcategories. OEE is used to guide continuous improvement efforts, benchmark performance, and align maintenance, operations, and quality activities.

OEE is not a stand-alone measure of overall business success, and its value depends on how planned production time is defined and what data are included. It should be interpreted in context and used alongside other indicators. In practice, teams use OEE to prioritize improvement actions, monitor progress over time, and target specific losses to raise overall equipment effectiveness.