What OEE is
OEE was born in the 1970s with Seiichi Nakajima's TPM (Total Productive Maintenance) and is today the most widely used indicator of how well a machine, a cell or a line uses the time in which it should be producing. An OEE of 100% means making only good parts, as fast as possible, without ever stopping during planned time.
The value of OEE lies not in the number itself but in its breakdown. Two presses with the same 65% OEE can have opposite problems: one stops often for breakdowns, the other never stops but runs slowly and scraps parts. The three factors tell you right away where to look, and the six big losses tell you why.
The formula: availability, performance, quality
Everything starts from planned production time: shift time minus the planned stops that are not losses, such as breaks and meetings. From there the three families of losses are subtracted, one after the other.
Availability = run time ÷ planned production time
Performance = (ideal cycle time × total parts) ÷ run time
Quality = good parts ÷ total parts
OEE = availability × performance × quality
= (good parts × ideal cycle time) ÷ planned production time
- Run time: planned time minus downtime, breakdowns and changeovers included.
- Ideal cycle time: the fastest cycle the machine can sustain for that part, from the nameplate or the best demonstrated. Not the average cycle: with the average cycle, performance always looks close to 100%.
- Good parts: those that pass the first time. Reworked parts count as scrap, because they consumed time without coming out good.
The last line is the most useful for checking the math: OEE is the time it would have taken to make only the good parts at ideal speed, divided by planned time. If the product of the three factors does not match this ratio, one of the inputs is wrong.
Worked example on one shift
A press runs a 480-minute shift with 30 minutes of breaks: planned time is 450 minutes. During the shift it stops for 25 minutes because of a breakdown and for 20 minutes for a die change. The ideal cycle time is 30 seconds per part; at the end of the shift it has produced 729 parts, 700 of them good.
| Quantity | Calculation | Result |
|---|---|---|
| Planned time | 480 − 30 min of breaks | 450 min |
| Run time | 450 − 25 − 20 | 405 min |
| Availability | 405 ÷ 450 | 90.0% |
| Performance | (0.5 min × 729) ÷ 405 | 90.0% |
| Quality | 700 ÷ 729 | 96.0% |
| OEE | 0.900 × 0.900 × 0.960 | 77.8% |
| Check | (700 × 0.5 min) ÷ 450 | 77.8% |
The shift lost 22% of planned time: 45 minutes of downtime (availability), about 40 minutes of slowdowns and micro-stops (performance) and 14.5 minutes spent making 29 scrapped parts (quality). Expressed in minutes, the three factors become comparable and it becomes clear where to act first.
What is a good OEE
The most cited benchmarks come from TPM experience and should be read as orders of magnitude, not as the same target for everyone: a manual assembly line and a continuous process plant are not comparable.
| OEE | How to read it |
|---|---|
| 85% and above | World class for discrete manufacturing: about 90% availability × 95% performance × 99.9% quality. |
| about 60% | Typical for many discrete manufacturers: there is room to improve. |
| about 40% | Common when you first start measuring for real: the first losses are often found right away. |
An OEE that jumps suddenly deserves suspicion: often the ideal cycle time has changed in the ERP, or a stop has been moved into the planned ones. Putting in writing what counts as a planned stop is the first step toward an OEE you can trust.
OEE, TEEP and OOE: the differences
The three indicators use the same good parts and the same ideal cycle time, but divide by a different time. OEE measures effectiveness over planned time; OOE (Overall Operations Effectiveness) over the time the plant is open, breaks included; TEEP (Total Effective Equipment Performance) over all calendar time, 24 hours a day.
| Indicator | Reference time | In the example |
|---|---|---|
| OEE | Planned production time (450 min) | 350 ÷ 450 = 77.8% |
| OOE | Operating time, breaks included (480 min) | 350 ÷ 480 = 72.9% |
| TEEP | Calendar time (1,440 min per day) | 350 ÷ 1,440 = 24.3% |
OEE is for improving the machine, TEEP for deciding whether you need one more shift or one more machine: a low TEEP with a high OEE means the capacity is there, but it is not planned.
Why OEE in Excel is not enough
A spreadsheet is perfectly fine for understanding the formula. It stops being enough when OEE has to be calculated every day, for every machine and every shift: the data comes from different sources (part counts and states from the PLC, orders and cycle times from the MES or the ERP, stop reasons from the operator), and whoever copies it by hand at the end of the month discovers the losses when they have already turned into delays.
The typical problems are three: different definitions across departments (what counts as a planned stop, which cycle time to use), data that arrives late, and micro-stops that stay invisible because nobody records them. Micro-stops in particular only show up when you read the machine states from the PLC, cycle by cycle.
Muvia has no packaged OEE module: your team writes the calculation once, in a Python function that Muvia runs every morning close to the data, for every machine and shift. With Muvia Industrial the edge node reads part counts and states from the PLCs with the drivers for Siemens S7, OPC UA and Modbus TCP, and the dashboard shows OEE per shift and losses the next day. The use case OEE and losses on stamping and welding lines walks through the path step by step.
OEE calculator
Enter the shift's planned time, the minutes of downtime, the ideal cycle time and the parts: the calculator returns the three factors and OEE. The starting values are those of the worked example.
OEE calculator
It starts from the shift example above: change the values for your machine.
- Availability
- 90.0%
- Performance
- 90.0%
- Quality
- 96.0%
- OEE
- 77.8%
Performance above 100% means the ideal cycle time is too slow: use the rated one or the best demonstrated one.
Frequently asked questions
OEE = availability × performance × quality. Availability = run time ÷ planned time; performance = ideal cycle time × total parts ÷ run time; quality = good parts ÷ total parts. In compact form: good parts × ideal cycle time ÷ planned time.
For discrete manufacturing the most cited benchmark is 85%, that is about 90% availability, 95% performance and 99.9% quality. Many manufacturers sit around 60%, and 40% is common when you first start measuring.
Yes: breaks, meetings and planned no-order stops do not enter planned production time. Breakdowns, changeovers, waiting for material and adjustments, on the other hand, are losses and stay in the availability calculation.
They use the same good parts and the same ideal cycle time, but OEE divides by planned time and TEEP by all calendar time. TEEP is OEE multiplied by the machine's utilization.
Because the ideal cycle time used is slower than the real one. Replace it with the nameplate cycle or with the best one demonstrated consistently; not with the average cycle, which hides slowdowns and micro-stops.