Are you an OEE naut? 5 dimensions of professional OEE management

Author: Timo Bertsch

Companies must continuously improve their processes or risk falling behind in the competition. As Abrahamson argues, it is “change or fall” [1]. This statement is already 20 years old, but in a globalized world of economic competition, increasing dynamism and a turbulent environment for industrial companies [2], it is more relevant than ever. Manufacturing companies are affected by challenging markets [2], in particular with regard to the shortening of product and technology life cycles [3], the increasing number of product variants and the increasing demand for individualized products [4,5,6]. The operation of plants is a key factor for entrepreneurial success.

The famous management thinker Peter Drucker is often quoted as saying: “What you can't measure, you can't improve” [7]. In this way, many companies have introduced the most common production KPI in recent years — overall equipment effectiveness (OEE), which is the key metric for all productive manufacturing [8]. OEE monitors the actual performance of a plant in relation to its capabilities under optimal manufacturing conditions (Figure 1).

However, recording the key figure alone does not lead to success, but requires a more comprehensive management approach. As we are aware of this, we have developed an approach to evaluating a company's OEE management together with experts and consultants. The result is a five-dimensional assessment of successful OEE management and a future-oriented vision for manufacturing companies.

The 5 dimensions of successful OEE management

In many industrial projects, we have found that five dimensions are fundamental to successful OEE management. These drivers are partly interdependent and cannot compensate each other. For lasting success, it is therefore important to consider all five categories and ensure that they are followed with focus.

Organizational awareness

From management to employees in the production hall. All hierarchical levels should be integrated into comprehensive OEE management. This category contains 4 main points that provide answers to the question of how strongly OEE is integrated into a company's strategic orientation and how engaged employees are.

• Integration of OEE management: How embedded is OEE management in the organization's strategic plan?
• Definition of goals and measures: How exactly are the goals and measures of OEE management defined and documented?
• Training activities: How established is employee development for OEE management in terms of training and coaching?
• Employee awareness: How high is awareness of the responsibility and importance of OEE management?

data collection

Comprehensive data collection is an important issue in the context of OEE management. It shows how advanced a company is in using the tools provided by digitization to automate end-to-end data recording. Measurement method, continuity and data management have proven to be particularly important in this context.

• Measurement method: What technical support is used to collect OEE relevant information?
• Assessment method: Is OEE relevant data recorded continuously without interruption or error?
• Data management: Is there continuous and audit-proof storage of all OEE-relevant data? Is the data made available to all interested parties?

Analyzing the collected data

Not only data collection, but also the analysis of collected OEE data is an important part of OEE management. Only if the data is continuously analyzed can the information be used for improvements [10]. We have identified two evaluation factors that contribute to the sustainable success of OEE management in the area of analysis.

• Assessment method: Is an automated and permanently available analysis of OEE losses carried out?
• availability: Are the analyses available to all parties involved in OEE management and the optimization of production processes?

Shopfloor

Shop floor meetings help to raise awareness of problems and make potential transparent. In recent years, the digital shop floor has also attracted the attention of practitioners and researchers. We have found that live visualization of relevant production data and frequent production meetings are crucial for the success of comprehensive OEE management.

• Visualization: Have Andon boards and digital shop floor boards been implemented?
• Shop floor meetings: Is there a regular shop floor meeting where live data and analyses are presented and discussed?

optimization

The previous four categories are important components of OEE management. However, without using them to fix problems and optimize processes, they have no visible impact. Optimization is therefore the key factor for sustainable and successful OEE management. A successful optimization project therefore gives OEE management the necessary boost, such as a rocket engine.

• Emergency measures: Have measures and standards been defined and implemented for failures and malfunctions (e.g. via an automated information chain)?
• Striving for continuous improvement: Are optimization options regularly reviewed and subsequent projects implemented?

The OEE management vision for manufacturing companies

To help companies implement their OEE management through the implementation of a North Star, we have developed a vision based on the results described above. This vision is intended to help companies establish or achieve fruitful OEE management.

Source citations

[1] Abrahamson, E., (2000). Change without pain. Harvard Business Review.
[2] Wiendahl, H.P., ElMaraghy, H., Nyhuis, P., Zaeh, M., Wiendahl, H.H., Duffie, N., Brieke, M., (2007). Changeable manufacturing—classification, design and operation. CIRP Ann. Manuf. Technol.
[3] Abele, E., Elzenheimer, J., Liebeck, T., Meyer, T., (2006). Globalization and Decentralization of Manufacturing. In: Dashchenko AI (ed) Reconfigurable Manufacturing Systems. Springer, Berlin.
[4] Jovane, F., Westkämper, E., Williams, D.J., (2009). The ManufutureRoad. Towards competitive and sustainable high-adding-value manufacturing. Springer, Berlin
[5] Abele, E., Reinhart, G., (2011). The future of production. Challenges, fields of research, opportunities (future of manufacturing. challenges, research areas, opportunities). Carl Hanser, Munich.
[6] Aurich, J.C., Gu, Z., (2007). Production function and knowledge: a strategic perspective. Prod. Eng.
[7] Cofeen, L., (2009). Marcetculture blog. Retrieved April 15, 2020, from https://blog.marketculture.com/2009/03/20/if-you-cant-measure-it-you-cant-manage-it-peter-drucker/
[8] Pomorski, T., (1997). Managing Overall Equipment Effectiveness [OEE] to Optimize Factory Performance, IEEE International Symposium on Semiconductor Manufacturing Conference Proceedings, San Francisco.
[9] The Productivity Development Team (1999). OEE for Operators (Vol. 1). Portland, Oregon: Productivity Inc.
[10] Focke, M., Steinbeck, J., (2018). Increasing plant productivity through OEE management — definitions, procedures and methods — from manual to Industry 4.0. Gabler Verlag.