Practical OEE – How To Calculate and Use Weighted OEE

December 5, 2008 Leave a comment Go to comments

We have presented the methods of calculating OEE for a process and also demonstrated how weighted OEE is calculated for multiple processes.  Our next challenge is to determine how this data can be used to make sure we are targeting the right processes for improvement.

Over the next few posts, we will show you how to calculate weighted OEE factors for each process.  This weighting will include calculations for each of the factors as well as the overall OEE.  The results of the individual weighted factors may well serve to point us in the right direction.

Calculating the weighted OEE and it’s factors is not just a simple calculation of averages as you can see from our previously calculated data.  It is easy to fall into this trap and it is also for this very reason that we have put forth the effort to show you how it should be done.

We highly recommend reviewing the posts presented over the past few days to refresh yourself with the ongoing development of our key Lean metric:  OEE.

Free Excel Downloads:

We have created a number of Excel spreadsheets that are immediately available for download from our FREE Downloads page or from the Free Downloads widget on the side bar.  These spreadsheets can be modified as required for your application.

Calculating Weighted OEE

We will continue to use the examples presented in our previous posts to develop our OEE metric.  We will start with the overall OEE percentage to help you understand the weighting concept applied here.

The basic formula to determine the weighted OEE for each individual process follows:

Weighted OEE = Process OEE * (Net Available Time / Total Net Available Time)

The OEE data taken from our previous examples is summarized in the table below:

  1. Machine A:  OEE = 80.22%, Net Available Time = 455 minutes
  2. Machine B:  OEE = 70.05%, Net Available Time = 455 minutes
  3. Machine C:  OEE = 55.90%, Net Available Time = 455 minutes

The total Net Available Time for all machines = 455 * 3 = 1365 minutes.  Now we can calculate our “weighted OEE” for each machine as shown:

  1. Machine A:  Weighted OEE = 80.22% * (455 / 1365) = 26.74%
  2. Machine B:  Weighted OEE = 70.05% * (455 / 1365) = 23.35%
  3. Machine C:  Weighted OEE = 55.90% * (455 / 1365) = 18.63%

Adding the individual weighted OEE together for each machine, we find the total is 68.72%.  Note that this matches the total OEE calculation from our previous post.

Warning:  Don’t fall into the trap of assuming that the same result could have been achieved by simply averaging the three OEE numbers.  The results in the calculation appear to be a simple average, however, this is misleading because you will also note that the Net Available Time and Total Net Available Time ratio is the same for each machine.  This is not always the case.  Many times, a machine may run for only half a shift or a few hours at a time.  This may significantly change the weighted OEE for a given machine and the result is not a simple arithmetic average.

Our next step will be to calculate the individual weighted factors for Availability, Performance, and Quality for each machine.  These calculations will readily demonstrate that it’s not a simple averaging process.

Weighted Availability Factor:

The basic formula to determine the weighted Availability Factor for each individual process follows:

Weighted Availability = Availability % * (Net Available Time / Total Net Available Time)

You will note that the weighting factor for availability is the same as the weighting factor for the overall OEE weight.  The Availability data taken from our previous examples is summarized in the table below:

  1. Machine A:  Availability = 92.97%, Net Available Time = 455 minutes
  2. Machine B:  Availability = 96.04%, Net Available Time = 455 minutes
  3. Machine C:  Availability = 95.16%, Net Available Time = 455 minutes

The total Net Available Time for all machines = 455 * 3 = 1365 minutes.  Now we can calculate our “weighted availability” for each machine as shown:

  1. Machine A:  Weighted Availability = 92.97% * (455 / 1365) = 30.99%
  2. Machine B:  Weighted Availability = 96.04% * (455 / 1365) = 32.01%
  3. Machine C:  Weighted Availability = 95.16% * (455 / 1365) = 31.72%

Adding the individual weighted Availability factors together for each machine, we find the total is 94.72%.  Note that this matches the total weighted Availability calculation from our previous post.

 Warning:  because all process have the same Net Available Time you may be thinking that this seems like a lot of work to simply get an average of the numbers.  More on this later when we take a look at Performance and Quality.

Weighted Performance Factor:

The basic formula to determine the weighted Performance Factor for each individual process follows:

Weighted Performance = Performance % * (Net Operating Time / Total Net Operating Time)

You will note that the weighting factor for performance is different.  This is because performance is a measure of how well the operating time was used to make parts.  The Performance data taken from our previous examples is summarized in the table below:

  1. Machine A:  performance = 88.26%, Net Operating Time = 423 minutes
  2. Machine B:  Performance = 77.23%, Net Operating Time = 437 minutes
  3. Machine C:  Performance = 61.70%, Net Operating Time = 433 minutes

The total Net Operating Time for all machines = 1293 minutes.  Now we can calculate our “weighted performance” for each machine as shown:

  1. Machine A:  Weighted Performance = 88.26% * (423 / 1293) = 28.87%
  2. Machine B:  Weighted Performance = 77.23% * (437 / 1293) = 26.10%
  3. Machine C:  Weighted Performance = 61.70% * (433 / 1293) = 20.66%

Adding the individual weighted Performance factors together for each machine, we find the total is 75.63%.  Note that this matches the total weighted Performance calculation from our previous post.

 Finally:  You will note that the Weighted Performance is NOT the same as the Arithmetic Average!  The arithmetic average in this case is 75.73%.  Although it doesn’t appear to be a significant difference, you wil see that it can be.

Weighted Quality Factor:

The basic formula to determine the weighted Quality Factor for each individual process follows:

Weighted Quality = Quality % * (Ideal Operating Time / Total Ideal Operating Time)

You will note that the weighting factor for quality is different.  This is because quality is a measure of how well the ideal operating time was used to make good (saleable) parts.  The Quality data taken from our previous examples is summarized in the table below:

  1. Machine A:  Quality = 97.77%, Ideal Operating Time = 373.33 minutes
  2. Machine B:  Quality = 94.44%, Ideal Operating Time = 337.50 minutes
  3. Machine C:  Quality = 95.20%, Ideal Operating Time = 267.17 minutes

The total Ideal Operating Time (to make all parts) for all machines = 978 minutes.  Now we can calculate our “weighted quality” for each machine as shown:

  1. Machine A:  Weighted Quality = 97.77% * (373.33 / 978) = 37.32%
  2. Machine B:  Weighted Quality = 94.44% * (337.50 / 978) = 32.59%
  3. Machine C:  Weighted Quality = 95.20% * (267.17 / 978) = 26.01%

Adding the individual weighted Quality factors together for each machine, we find the total is 95.92% as expected.  Note that this matches the total weighted Quality calculation from our previous post.

 Finally:  You will note that the Weighted Quality is NOT the same as the Arithmetic Average! 

Remember to get your free downloads.  We have created a number of Excel spreadsheets that are immediately available for download from our FREE Downloads page or from the Free Downloads widget on the side bar.  These spreadsheets can be modified as required for your application.

Until Next Time – STAY Lean!

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