8 Ways To Improve OEE in Your Factory

Abby Baumann May 6, 2022
how to improve OEE

Every day, manufacturers strive to ship their parts on time and at the quoted price. This can be very complicated, with factors like labor shortages and machine downtime preventing companies from achieving maximum OEE. While manufacturers work to mitigate these challenges, there isn’t always a clear process to follow when improving operations. OEE, otherwise known as Overall Equipment Effectiveness, is a measurement that helps you determine the machine potential in your factory or production lines. When you implement OEE, you can identify, monitor, and reduce the amount of loss your organization experiences over a given period of time, which directly impacts your bottom line. Manufacturing operations across the globe use OEE metrics as part of their KPIs for understanding their production systems better. By tracking OEE, manufacturers can discover where losses may be occurring and then take the necessary steps to correct those losses.

OEE, otherwise known as Overall Equipment Effectiveness, is a measurement that helps you determine the machine potential in your factory or production lines. When you implement OEE, you can identify, monitor, and reduce the amount of loss your organization experiences over a given period of time, which directly impacts your bottom line. Manufacturing operations across the globe use OEE metrics as part of their KPIs for understanding their production systems better. By tracking OEE, manufacturers can discover where losses may be occurring and then take the necessary steps to correct those losses.

Because OEE is such an important metric, it’s equally important that you do everything you can to improve it. We’ve outlined eight of the best measures you can take in order to improve your OEE and your plant’s overall efficiency and production capabilities.

1. Utilize IIoT for Real-Time Data Collection

The Internet of Things (IoT) and the Industrial Internet of Things (IIoT) describe the integration of internet- and cloud-based capabilities into a manufacturing setting. Before this digital transformation, you needed to gather data manually or run reports at designated times. When you have smart equipment and machinery, you can capture and analyze data in real time.

Real-time data can give you immediate insight into productivity. Rather than waiting for data, you have control over the collection of information in your organization. With the technological advancements brought on by the IIoT, you have a fast track to production reports, OEE tracking, and historical data. These tools can even interpret and analyze the information for you. This allows you to contextualize your data and use it to drive decisions much quicker than before.

When you don’t have real-time data, you are dependent on manually collected data — which is much more likely to have errors and takes longer to collect. This slows down the manufacturing process and makes it more difficult to make well-informed decisions.

2. Ensure Machines Are Running Properly With Predictive Maintenance

In order for OEE to be as high as possible, you need to ensure that your machine performance is at the optimal level during planned production times. Machine breakdowns and equipment failure can cause bottlenecks, slowdowns, or even total production stops. All of that unplanned downtime adds up and results in lost revenue and wasted production time.

In order to keep the machines on the shop floor operating as they should, manufacturers should practice predictive maintenance. Predictive maintenance is the process of identifying potential machine failures and fixing the problems before they ever occur. With the help of preventive maintenance and machine monitoring, manufacturers can avoid unnecessary maintenance while keeping machines running.

3. Consider Automating Data Collection and Reporting

Automating data collection and reporting on your production floors can help to improve your equipment’s OEE scores. Automation ensures that no data slips through the cracks, and avoids the shortcomings of manually collected data. Without the right data, you won’t be able to increase your levels of productivity or create a better working environment.

Rather than relying on pens, paper, and spreadsheets to track data, automated systems do the heavy lifting for you, allowing you and your team to handle tasks that involve deeper thought and human interpretation. With the rise of IIoT and automated systems, data collection, reporting, and analysis tools help manufacturers make sense of data, which helps them streamline the production process.

4. Conduct a Pareto Analysis Using the 80/20 Rule

Another way to improve your facility’s OEE is to use a technique called the Pareto analysis. This technique helps you determine the input factors that have the greatest impact on outcomes. This allows you to allocate resources to the areas of your business that are slowing down production and reducing your OEE the most, rather than trying broad strategies that don’t address the main issues.

What Is a Pareto Analysis?

Developed in 1906 by Italian economist Vilfredo Pareto, the Pareto analysis looks through each problem or benefit in your organization and gives it a numerical score. The higher the score, the greater the impact the factor has on your organization. This allows you to determine the specific factors that are slowing down production and narrow down the areas of your business that need the most support to keep production running smoothly.

What Is the 80/20 Rule?

The 80/20 rule is the heart of the Pareto analysis. It states that 80% of a project’s outcome is achieved by 20% of the factors involved. Essentially, the rule is saying that 20% of causes are responsible for 80% of the problems in a business. By discovering what 20% of your process is holding you back, you can fix those issues and increase the outcome for 80% of your operations.

5. Account For All Production Stops

Production stops and downtime are somewhat expected in a factory setting. However, too much downtime can cause major setbacks for your entire organization, from supply chain to customer satisfaction. In order to determine the cause of downtime and production stops, you need to take a closer look at every instance of downtime that occurs on each shift.

To improve OEE you need to understand not just when stops occur but why they happen. It’s good to know when production stops happen and how often they occur, but if you don’t look into the reasons for downtime then you can’t solve any of the issues behind it. This allows you to notice patterns in production lines, machines, or even operators that you wouldn’t notice without accounting for stops.

6. Eliminate the Six Big Losses

In lean manufacturing, the Six Big Losses are a way to categorize the waste and loss that takes place in a plant. These losses are responsible for the majority of waste in a factory, and can lower your OEE — which prevents your plant from being as productive as it needs to be in order to succeed. The Six Big Losses are:

  • Planned stops
  • Unplanned stops
  • Micro stops
  • Slow cycles
  • Start-up rejects
  • Production rejects

By eliminating these six areas of loss, you can provide a better framework for production scheduling and planning that improves overall efficiency and productivity in your factory — as well as increasing product quality and customer satisfaction. Keep in mind that while it’s tempting to focus on unplanned stops, all six areas are critical for improving your OEE and should all be considered as you create your strategies.

7. Use Root Cause Analysis

Root cause analysis, also known as RCA, is a problem-solving system that works to understand the core issue in every problem that arises during the production cycle. By working to solve the root cause rather than the more obvious symptoms of an issue, you can prevent the problems from coming up again and create long-term success in your organization rather than short-term solutions. To perform an RCA, take the following steps:

  • Define the problem.
  • Determine the causes of the problem.
  • Find the main root cause.
  • Brainstorm solutions.
  • Create a plan for action.
  • Verify and measure the effectiveness of the solution.

By following these steps and remembering the Pareto analysis, you can start to narrow down your organization’s main issues. Then you can examine those issues more closely and create a plan or system that addresses the root of your production downtimes and slowdowns.

8. Create an Action Plan

While identifying issues and increasing the use of technology can help to increase OEE and eliminate inefficiency in your organization, you also need to create a plan for action with step-by-step initiatives for success. Without a clear plan in place, you won’t have the cohesion among your team needed to improve OEE and increase productivity. Let’s look at some of the steps you’ll need to consider while crafting your action plan.

Reduce High Levels of Downtime

Downtime is the number one reason behind machine ineffectiveness and low OEE in your factories. Therefore, reducing that downtime is one of the most important steps in your action plan. You can begin by determining which machines have the highest rates of downtime and work to discover the cause of the downtime. This can help you keep machines running and avoid stoppages that slow down production.

Identify Uneven Machine Utilization

Machine utilization is an important part of OEE. If machines aren’t being used effectively — or some machines are being used more than others — it can lead to unplanned wear and tear and a decrease in optimization. Machine monitoring can help give you greater insight into your machine utilization and maintenance needs, and it doesn't have to be a huge expense. The benefits of these tools far outweigh the cost, as they help you create a better usage-based schedule for machinery.

Avoid a Labor Shortage

Labor shortage is a problem that many manufacturers face. While increased robotics and machine automation can make some human operator jobs obsolete, the truth is that almost all factories still require a significant human workforce in order to run effectively. Without the operators to keep machines running, slowdowns and downtimes are inevitable. Focusing on benefits and creating opportunities for growth can help with employee retention and hiring.

Monitor Inconsistent Part Quality

Part quality is another area that can cause slowdowns and lower your OEE. If you begin to notice low- or inconsistent-quality parts, it’s a signal that your machines may not be running as effectively as they could be.

See How Amper Helps Manufacturers Improve OEE

OEE is an important metric that lets you know how well the equipment in your factory is being utilized. When your OEE score is low, you are likely suffering from significant downtimes, a lack of efficiency, and increased waste in your production facilities. By examining your overall equipment effectiveness and taking actionable steps to improve it, you can create a more productive working environment and meet your output goals.

Production monitoring software is one of the best ways to examine, analyze, and find solutions to improve OEE. At Amper, we provide digital factory tools that give you unparalleled insights into your machine metrics, helping you elevate your factory’s efficiency. To learn more, schedule a demo with us today and discover what Amper can do for your organization.

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