1_3. overall equipment effectiveness
TRANSCRIPT
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Pukyong National Univ. IntelligentMechanics Lab.
Prof. Bo-Suk Yang
Intelligent Mechanics Lab.
Pukyong National University
- Overview -
Overall EquipmentEffectiveness()
Maintenance Optimization
Machines have souls.
If you take special care about them, they will return it.
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Pressured by current economic conditions and global competition,manufacturers are becoming increasingly sensitive about operational
costs.
In this environment, it pays to consider both creative and proven
methods that you can use to bring your product to market at minimum
cost and can be guaranteed by an effective maintenance system.
OEE is a method that meets this objective.
OEE is a performance metric compiled from machine-availability data.
OEE also captures the reasons for downtime (e.g. machine conditions,
material status, production personnel, or quality issues) and can
deal with the individual machine level, a line level or the entire plant.
At the plant level, OEE metrics can be correlated with other plant
metrics to provide key performance indicators.
ASurvival Tool for Manufacturing
Reference: Jack Wilkins, Sensors, Nov 16, 2007
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The overall performance of a single piece of equipment or even an
entire factory, will always be governed by the cumulative impact of
the 3 OEE factors:Availability, Performance Rate & Quality Rate
Definition of OEE
OverallEquipmentEfficiency
Availability Performance Quality= v v
Outages of
machines
Retooling &
adjustment
Reduced
operating
speed
Idle time& short
standstills
In process
quality errors
Startup difficulties
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OEE is a percentage derived by multiplication of the three ratios forthe factors mentioned above.
OEE is a measure comparing how well manufacturing equipment is
running compared to the ideal plant.
The resulting measurement is expressed as the ratio of the actualoutput of the equipment divided by the maximum possible output of
the equipment under ideal conditions.
In other words, OEE takes an holistic view ofall losses that impact on
equipment performance: not being available when needed; not running
at the ideal rate and not producing first quality output.
Definition of OEE
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Managers can monitor OEE plant metrics and drill down to find the
root causes of problems, getting minute-by-minute updates to enable
real-time process improvement.
Downtime reductions can be readily achieved by using OEE to gain
visibility into machine status and to analyze problems.
Facility operators and supervisors spend an enormous amount of timerecording, analyzing, & reporting on downtime, then further explaining
these reports to management.
OEE system captures & reports downtime and efficiency automatically.
This eliminates the time wasted in non-value-added reporting and
allows personnel to focus on more valuable tasks.
With OEE, everyone from the plant floor to the boardroom is more
informed, more often, more easily.
ASurvival Tool for Manufacturing
Reference: Jack Wilkins, Sensors, Nov 16, 2007
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OEE also enables predictive maintenance, which can dramaticallyreduce repair costs.
As the information on factors contributing to downtime grows in the
historical database, the maintenance department can classify trends
and predict impending failures.
Also, by interfacing OEE system with a Computerized Maintenance
Management System (CMMS), the maintenance department can
take proactive steps to do predictive maintenance.
For example, maintenance can order the necessary part in advance
and get better rates.
It can allocate repair personnel from an existing pool of resources
instead of hiring someone on an emergency basis.
ASurvival Tool for Manufacturing
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All this can result in huge savings compared with repairing a machineafter the breakdown has happened.
The net effect ofreduced machine downtime, higher productivity of
operators, and reduced defects is the ability to achieve higher
production levels with the same amount of resources.
ASurvival Tool for Manufacturing
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Generally, operations of most manufacturing plants are running at only
60% efficiency during uptime. The other40% of the total equipment timeare lost due to various downtime.
Among which, 15% of plant utilization are lost to scheduled downtime.
Scheduled downtime can be preventive maintenance, setup, change of
consumables/materials, production test and so on.
Unscheduled downtime accounts for10%, which is usually difficult to quantifybut preventable if proper preventive measures are taken.
The remaining significant 15% of the total utilization is lost as hidden downtime.
Hidden downtime can be due to shift
interruptions, minor maintenance issues,
operator not available and so on, which
are difficult to quantify and remain
unnoticed without a monitoring system.
Plant Utilization Statistics
Uptime
Scheduled
Downtime
Unscheduled
Downtime
Hidden
Downtime
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Technology Roadmap, the Semiconductor Industry Association (SIA) identified
the need to improve Overall Equipment Effectiveness, which is an industry
standard measure of equipment productivity.
Surveyed the industry and found that an average piece of wafer processing
equipment has an OEE of45%.
Need to increase OEE from 45% to 65% by 2002, and to 80% by 2011.
The number oftest wafers used is a significant factorin OEE. Today, 33% ofwafers processed are used to test processing equipment, to make sure the
equipment is operating correctly.
Plant Utilization Statistics
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When a failure incident occurs there is a consequential loss of profitsand accumulating of costs.
Cost of failure includes lost profit, the cost of the repair, the fixed and
variable operating costs wasted during the downtime and a myriad of
consequential costs that reverberate and surge through the business.
The costs of failure cannot be escaped and are counted in millions ofdollars of lost profit per year.
Total defect and failure true costs are not normally recognized by
managers, yet they can send businesses bankrupt.
In the instance of a failure all its costs and losses are automatically
incurred on the business.
These costs can only be prevented by precluding the failure in the first
place.
Defect and Failure Cost?
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Cost of Failure to a Business
Normal business in operation
= +
:
,,
:()
()
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A failure incident occurs at time t1 that stops the operation. Future profits are lost because no product can be made
(though inventory can still be sold until it is gone).
Fixed costs continue accumulating but are now wasted because
no product is being produced.
Cost of Failure to a Business
Effects on costs and profit of a failure incident
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Some of the variable costs will fall because they are not used,whereas some, like maintenance, will suddenly rise in response
to the incident.
Other variable costs are retained in the expectation that the equipment
will get back into operation quickly.
These are also wasted because they are no longer involved in makingsaleable product.
Cost of Failure to a Business
Effects on costs and profitof a failure incident
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Losses and wastes continue until the plant is back in operationat time t2.
The cost for repair from a severe outage can be many times
the profit made in the same time period (dotted outline).
Cost of Failure to a Business
Effects on costs and profit of a failure incident
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When a failure happens many people suddenly get involved insolving it.
Meetings are held, overtime is worked, subcontractors are brought-in,
engineers investigate, parts and spares are purchased to get back in
operation.
Instead of the variable costs being a proportion of production, asintended, they instead rise and take on a life of their own in response
to the failure.
The losses grow proportionally bigger the longer the repair takes or
the greater the consequences of the failure.
Cost of Failure to a Business
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Shaded areas in figure that when a failure happens the cost tothe business is lost future profits, plus immediately wasted fixed costs,
plus immediately wasted variable costs, plus the added variable costs
needed to get the operation back in production.
There are many other consequential costs too.
Cost of Failure to a Business
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The losses and wasted costs accumulate in production, the cost ofmaintenance climbs, the knock-on costs() and
wasted
time across the business rise and profits in the business fall.
Cost of Failure to a Business
Effects on profitability ofrepeated failure incidents
http://www.lifetime-reliability.com
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Each organization is different and each defect, error and failure itsuffers has different consequences.
The total cost to the organization of an incident will be shared
amongst the departments and people involved.
The proportion of the cost each department ends up carrying
depends on the extent of its involvement.
The total and true costs incurred by a business from a failure event
reverberate and surge throughout the organization.
The 60 consequential costs listed below reflect a good number of
them, though there are others specific to each organization and
you will need to identify and record them.
Total and True Failure Cost and Defect Cost
http://www.lifetime-reliability.com
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Labour : both direct and indirect operators
repairers
supervisory
management
engineering
overtime/penalty rates
Product waste
scrap
replacement production
clean-up
reprocessing
lost production lost spot sales
off-site storage
Total and True Failure Cost and Defect Cost
http://www.lifetime-reliability.com
Services emergency hire
sub-contractors
travelling
consultants
utility repairs
temporary accommodation
Materials
replacement parts
fabricated parts
materials
welding consumables
workshop hire shipping
storage
space
handling
disposal
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Equipment OEM
energy waste
shutdown
handover
start-up
inefficiencies
emergency hire
damaged items
Additional capital
replacement equipment
new insurance spares
buildings and storage
Total and True Failure Cost and Defect Cost
http://www.lifetime-reliability.com
Consequential penalty payments
lost future sales
legal fees
loss of future contracts
environmental clean-up
death and injury
safety rectification
Administration
documents and reports
purchase orders
meetings
meeting rooms stationary
planning, schedule changes
investigations and audits
invoicing and matching
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Looking at machine operation, we distinguish six types of wastewe refer to as losses, because they reflect lost effectiveness of
the equipment
These six big losses are grouped in three major categories:
downtime, speed losses, and defect losses
Loss Categories The Six Big Losses
Downtime
(lost availability)
Equipment failures ()
Setup and adjustments ()
Speed losses(lost performance)
Idling and minor stoppages () Reduced speed operation ()
Defect losses
(lost quality)
Scrap and rework ()
Startup losses ()
Six Big Losses
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Merely considering on the optimization of the maintenance strategyis inadequate to cease or to minimize these losses
A unitary approach is needed which considers the factors influencing
the OEE and enables complex solutions.
This approach is delivered by the maintained production concept.
The realization of the maintained production is based on the constantoptimization of the condition of machines and equipments.
Six Big Losses
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Maintenance Improvement Process
OEE
Goals for a capacity improvementandmaintenance optimization process
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Typical goals for a capacity improvement and maintenanceoptimization process would be:
Improve overall system availability by __ %
Improve customer satisfaction index by __ %
Decrease maintenance expenditures by __ %
Decrease unplanned downtimes by __ % Decrease annual equipment replacements by __ %
Improve craft skill and cross-training knowledge by __ %
Decrease personnel overtime by __ %
Improve the documentation of equipment problems by __ %
Implement automated work order processing for _ services centers by {date} Reduce the number of safety related incidences by __ %
Typical Goals
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Maintenance optimization is about how work is done. We often think ofdesign as applying only to products.
Yet, maintenance optimization is based on the premise that the design
of processes - how work is done - is of essential importance.
Starting point for organizational success is well-designed processes.
Equipment reliability is improved, equipment life is extended, product
quality is improved, and capacity goes up.
The net effect is an improvement in the OEE, achieved by increasing
the combination of factors associated with availability, capacity and
quality.
The key issue in order to achieve improved OEE is therefore
"What is the best process by which to maintain and
operate the critical and important equipment?"
Maintenance Improvement Process
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Downtime refers to time when the machine should be running,
but it stands still.
Downtime includes two main types of loss: equipment failures,
and setup and adjustments.
Equipment Failures Loss ()
Sudden and unexpected equipment failures, orbreakdowns, arean obvious cause of loss, since an equipment failure means that
the machine is not producing any output.
Downtime Losses (LostAvailability)
The economical consequences from an unexpected one-day stoppagein industry may become as high as up to 100,000 ~ 200,000 euros :
Nuclear power plant: 300,000 Pulp and paper plant: 200,000 Steel works and continuous casting: 150,000 Chemical factory, coal power station and mining plant: 100,000 Oil refinery: 50,000 (Holmberg et al., 2004)
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Setup & Adjustments Loss ()
Most machine changeovers require some period of shutdown so
that internal tools can be exchanged.
Time between the end of production of the last good part and
the end of production of the next good part is downtime.
This downtime loss often includes substantial time spent making
adjustments until the machine gives acceptable quality on new part.
Downtime Losses (LostAvailability)
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qq :,
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A speed loss means that the equipment is running, but it is not
running at its maximum designed speed.
Speed losses include two main types of loss: idling and minor
stoppages, and reduced speed operation.
Idling and Minor Stoppages ()
When a machine is not running smoothly and at a stable speed,
it will lose speed and obstruct a smooth flow.
The idling and stoppages in this case are caused not by technical
failures, but by small problems such as parts that block sensors or
get caught in chutes.
Although the operator can easily correct such problems when they
occur, the frequent halts can dramatically reduce the effectiveness
of the equipment.
Speed Losses (Lost Performance)
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Speed Losses (Lost Performance)
: www.ktpm.co.kr
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Reduced Speed Operation (,) Reduced speed operation refers to the difference between the actual
operating speed and the equipments designed speed (also referred
to as nameplate capacity).
There is often a gap between what people believe is the maximum
speed and the actual designed maximum speed. The goal is to eliminate the gap between the actual speed and the
designed speed.
Significant losses from reduced speed operation are often neglected
or underestimated.
Speed Losses (Lost Performance)
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Speed Losses (Lost Performance)
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: 60 50
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A defect loss means that the equipment is producing products thatdo not fully meet the specified quality characteristics.
Defect losses include two major types of loss: scrap and rework,
and startup losses.
Defect Losses (Lost Quality)
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Scrap and Rework ()
Loss occurs when products do not meet quality specifications,even if they can be reworked to correct the problem.
The goal should be zero defects - to make the product right the first
time and every time.
Defect Losses (Lost Quality)
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Startup Losses (,)
Startup losses are yield losses that occurwhen production is notimmediately stable at equipment startup, so the first products do
not meet specifications.
This is a latent loss, often accepted as inevitable, and it can be
surprisingly large.
Defect Losses (Lost Quality)
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Most industries have some kind of gauge system on their equipmentthat measures quantities such as uptime, units produced, and
sometimes even the production speed.
These are appropriate things to look at if the focus is on whats
coming out of the machine.
Besides whats coming out of the machine, we also want to knowwhat could have come out, and where we are losing effectiveness.
OEE offers a simple but powerful measurement tool to get inside
information on what is actually happening.
OEE calculation is a metric that gives us daily information about
How effectively the machine is running andWhich of the six big losses we need to improve.
OEE is not the only indicatorto assess a production system,
but it is certainly very important if our goal is improvement.
OEE Metric
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OEE is a performance measurement comprised ofasset availability,production rate and quality levels.
Elements of OEE
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The three main categories ofequipment-related losses
Downtime
Speed loss
Defect or quality loss
Are also the main ingredients for determining the OEE.
OEE is calculated by combining three factors that reflect these
losses:
Availability rate
Performance rate Quality rate
Elements of OEE
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Availability rate is the time the equipment is reallyrunning, versus the time it could have been running.
A low availability rate reflects downtime losses:
Equipment failures
Setup and adjustments
Performance rate is the quantity produced during
the running time, versus the potential quantity, giventhe designed speed of the equipment.
A low performance rate reflects speed losses:
Idling and minor stoppages
Reduced speed operation
Quality rate is the amount of good products versus
the total amount of products produced.A low quality rate reflects defect losses:
Scrap and rework
Startup losses
Elements of OEE
Availability rate = Operating Time /
Planned Production Time
Performance rate = Ideal Cycle Time /
(Operating Time / Total Pieces)
= (Total Pieces / Operating Time) /
Ideal Run Rate
Quality rate = Good Pieces /
Total Pieces
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To calculate OEE, we multiply the three factors together:
OEE = Availability Rate xPerformance Rate xQuality Rate
Calculation of OEE
The diagram shows graphically
how the losses in availability,
performance, and quality work
together to reduce OEE of a machine.
The top bar, total operating time, shows
the total time a machine is available to
make a product.This is usually considered to be 480
minutes per 8-hour shift.
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Bars A and B show Availability
Bar A represents the net operating time, which is the time available
for production after subtracting planned downtime (no scheduled
production) such as a holiday, no orders, or no personnel.
Bar B shows the actual running time after subtracting downtime
losses such as equipment failures and setup and adjustments.
Bars C and D show Performance
Bar C represents the Target Output of the machine during the
running time, calculated at the designed speed of the machine.
Below it, a shorter fourth bar, D, represents the actual output,
reflecting speed losses such as minor stoppages and reduced
operating speed.
Calculation of OEE
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Bars E and F show Quality
As you can see, the actual output (E) is reduced by defect losses
such as scrap and startup losses, shown as the shaded portion of
bar F.
As this diagram shows, the bottom-line good output is only a
fraction of what it could be if losses in availability, performance,
and quality were reduced.
The diagram also suggests that to maximize effectiveness- to grow
the good output on the bottom line- you must reduce not only
quality losses, but also availability and performance losses.
The three factors work together, and the lowest percentage isusually the constraint that most needs addressing.
Calculation of OEE
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The table below contains hypothetical shift data, to be used for a
complete OEE calculation, starting with the calculation of the OEEfactors ofAvailability, Performance, and Quality.
Note that the same units of measurement (in this case minutes and
pieces) are consistently used throughout the calculations.
Example of OEE Calculation
Item Data
Shift Length 8 hours = 480 min.
Short Breaks 2 v 15 min. = 30 min.
Meal Break 1 v 30 min. = 30 min.
Down Time 47 minutes
Ideal Run Rate 60 pieces per minute
Total Pieces 19,271 pieces
Reject Pieces 423 pieces
Planned Production Time= [Shift Length - Breaks]
= [480 - 60] = 420 minutes
Operating Time
= [Planned Production Time - Down
Time]
= [420 - 47] = 373 minutes
Good Pieces
= [Total Pieces - Reject Pieces]
= [19,271 - 423] = 18,848 pieces
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Example of OEE Calculation
Availability = Operating Time / Planned Production Time
= 373 minutes / 420 minutes
= 0.8881 (88.81%)
Performance = (Total Pieces / Operating Time) / Ideal Run Rate
= (19,271 pieces / 373 minutes) / 60 pieces per minute= 0.8611 (86.11%)
Quality = Good Pieces / Total Pieces
= 18,848 / 19,271 pieces
= 0.9780 (97.80%)
OEE =Availability v Performance v Quality
= 0.8881 x 0.8611 x 0.9780
= 0.7479 (74.79%)
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World-Class Goal of OEE
In practice, generally accepted world-class goals for each factorare quite different from each other, as is shown in the table below.
Of course, every manufacturing plant is different.
Worldwide studies indicate that average OEE rate in manufacturing
plants is 60%.
As you can see from the table, a World Class OEE is considered tobe 85% or better.
There is room for improvement in most manufacturing plants
OEE Factor World Class
Availability 90.0%
Performance 95.0%
Quality 99.9%
Overall OEE 85.0%
www.oee.comCan you download the fast guide to OEE
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Goal of measuring OEE is to improve the effectiveness of yourequipment.
Since equipment effectiveness affects shop-floor employees more
than any other group, it is appropriate for them to be involved in
tracking OEE and in planning and implementing equipment
improvements to reduce lost effectiveness. Recommend that the operatorcollect the daily data about
the equipment for use in the OEE calculation.
Collecting this data will
Teach the operator about the equipment
Focus the operators attention on the losses
Grow a feeling of ownership of the equipment
Goal & Benefits of OEE Measurement
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The shift leaderorline manageris often the one who will
Receive the daily operating data from the operatorand
Process it to develop information about the OEE.
Working hands on with the data will;
Give the leader/managerbasic facts and figures on the equipment
Help the leader/managergive appropriate feedback to the operators
and others involved in equipment improvement
Allow the leaderto keep management informed about equipment
status and improvement results
Goal & Benefits of OEE Measurement
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www.oee.com www.lighthousesystems.com
www.idhammarsystems.com/product www.downtimecentral.com
www.oeeimpact.com
www.silkron.com
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