Quality Progress - March 2018 - 64

```Level Up
A refresher on a quality
tool, concept or method

Aside from meeting specific quality
standards requirements-such as those
found in ISO 9001-well-designed quality
system metrics also can serve as meaningful indicators of the strengths and
weaknesses of an organization's various
processes.
As a quality manager, I often consider
how precisely our quality system objectives and other metrics describe the
effectiveness of our systems. One metric
I started using recently-overall equipment effectiveness (OEE)-has provided
our management team with a composite
measurable that encompasses three major
branches of our operation: maintenance,
production and quality.
which standardized quality systems have
taken a prominent role in manufacturing-
certain metrics have risen to the top as the
most common key indicators of performance in each of these three areas.

A manufacturing example

Consider this simple example to see how
common key indicators work together to
form OEE:
+ Machine availability is a common metric
for measuring the effectiveness of an
organization's maintenance process. It's
calculated as the ratio of a machine's
actual run time to its scheduled run
time. In some organizations, operator
breaks and tardiness can reduce a
machine's run time, but unplanned outages because of maintenance problems
always reduce availability.
A machine was scheduled to run for
eight hours during a given shift, but
it actually ran for only 6.1 hours. This
yields an availability of:
(6.1 / 8) x 100 = 76.3%
+ For production, efficiency is a key metric calculated as a ratio of the number of

64 QP

March 2018 ❘ qualityprogress.com

Use overall equipment effectiveness to improve
process weaknesses by Ray Harkins

parts produced in a certain amount of
time to the maximum number of parts
that could have been produced in the
same amount of time.
If time studies demonstrate that a
machine can produce 2,500 pieces per
hour, but on a given day an operator
produces 13,000 pieces in 6.1 hours
of production, this operation ran an
efficiency of:
(13,000 / 6.1)
x 100 = 85.2%.
2,500
+ Quality typically is measured as a ratio
of the number of good parts produced
to the total number of parts produced.
So, if only 12,770 of the 13,000 total
parts produced meet the customer's
specifications, the measure of quality
acceptance is:
(12,770 / 13,000) x 100 = 98.2%.
OEE is calculated as the product of
these three metrics:
OEE = % Available x % Efficient x
% Acceptable
Specifically, the OEE in this example is:
OEE = 76.3% x 85.2% x 98.2 = 63.8%.
In his book, Overall Equipment Effectiveness, Robert Hansen details the OEE
evaluation scale shown in Table 1. According to the scale, the OEE of this process is
unacceptable.1

TA B L E   1

OEE evaluation scale
OEE

Comment

< 65%

Unacceptable. Get help now.

if quarterly trends are
65% - 75% Passable
improving.
75% - 85% Pretty good.
> 85%

World class for batch
processes.

> 90%

World class for continuous
discrete processes.

> 95%

World class for continuous
stream processes.

OEE = overall equipment effectiveness

OEE to compare part families, manufacturing facilities or other logical groupings.
Developing and using metrics such
as OEE that highlight an organization's
best opportunities for improvement have
the potential to unlock the next level of
profitability.
REFERENCE
1. Robert C. Hansen, Overall Equipment
Effectiveness: A Powerful Production/
Maintenance Tool for Increased Profits, first
edition, Industrial Press Inc., 2011.

Total effectiveness

OEE essentially is a measure of the total
effectiveness of a manufacturing operation. When applied to the bottleneck
operation in a process flow, OEE can
provide a powerful indicator of the potential sales that are left on the table due to
losses in the system. Business analysts
refer to the sum of these losses as the
effect of the hidden factory.
While the example given earlier uses
OEE to measure the effectiveness of a
shift, business professionals also can use

Ray Harkins is the
quality manager for
Ohio Star Forge in
Warren, OH. He earned
his bachelor's degree in
mechanical engineering
technology from the
University of Akron. He is a certified
quality engineer, auditor and calibration
technician, and a senior member of ASQ.
He also teaches quality and businessrelated courses on Udemy.com.

```
http://www.Udemy.com http://www.qualityprogress.com

Seen and Heard
Progress Report
Career Coach
My Quality Story
In the Right Direction
A Different Kind of BBQ
Gaining Ground
Impeding Progress
Innovation Imperative
Statistics Spotlight
Standard Issues
Marketplace
Footnotes
Back to Basics
Quality Progress - March 2018 - INTRO
Quality Progress - March 2018 - cover1
Quality Progress - March 2018 - cover2
Quality Progress - March 2018 - 1
Quality Progress - March 2018 - 2
Quality Progress - March 2018 - 3
Quality Progress - March 2018 - 4
Quality Progress - March 2018 - 5
Quality Progress - March 2018 - Seen and Heard
Quality Progress - March 2018 - 7
Quality Progress - March 2018 - Expert Answers
Quality Progress - March 2018 - 9
Quality Progress - March 2018 - Progress Report
Quality Progress - March 2018 - 11
Quality Progress - March 2018 - 12
Quality Progress - March 2018 - Mr. Pareto Head
Quality Progress - March 2018 - Career Coach
Quality Progress - March 2018 - 15
Quality Progress - March 2018 - My Quality Story
Quality Progress - March 2018 - 17
Quality Progress - March 2018 - In the Right Direction
Quality Progress - March 2018 - 19
Quality Progress - March 2018 - 20
Quality Progress - March 2018 - 21
Quality Progress - March 2018 - 22
Quality Progress - March 2018 - 23
Quality Progress - March 2018 - A Different Kind of BBQ
Quality Progress - March 2018 - 25
Quality Progress - March 2018 - 26
Quality Progress - March 2018 - 27
Quality Progress - March 2018 - 28
Quality Progress - March 2018 - 29
Quality Progress - March 2018 - 30
Quality Progress - March 2018 - 31
Quality Progress - March 2018 - Gaining Ground
Quality Progress - March 2018 - 33
Quality Progress - March 2018 - 34
Quality Progress - March 2018 - 35
Quality Progress - March 2018 - 36
Quality Progress - March 2018 - Impeding Progress
Quality Progress - March 2018 - 38
Quality Progress - March 2018 - 39
Quality Progress - March 2018 - 40
Quality Progress - March 2018 - 41
Quality Progress - March 2018 - 42
Quality Progress - March 2018 - 43
Quality Progress - March 2018 - Innovation Imperative
Quality Progress - March 2018 - 45
Quality Progress - March 2018 - 46
Quality Progress - March 2018 - 47
Quality Progress - March 2018 - Statistics Spotlight
Quality Progress - March 2018 - 49
Quality Progress - March 2018 - 50
Quality Progress - March 2018 - 51
Quality Progress - March 2018 - 52
Quality Progress - March 2018 - 53
Quality Progress - March 2018 - Standard Issues
Quality Progress - March 2018 - 55
Quality Progress - March 2018 - 56
Quality Progress - March 2018 - 57
Quality Progress - March 2018 - Marketplace
Quality Progress - March 2018 - 59
Quality Progress - March 2018 - Footnotes
Quality Progress - March 2018 - 61
Quality Progress - March 2018 - 62
Quality Progress - March 2018 - 63
Quality Progress - March 2018 - Back to Basics
Quality Progress - March 2018 - cover3
Quality Progress - March 2018 - cover4
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