A machine may run for many hours and still deliver less output than expected. Before attributing the difference to a failure, separate losses from stoppages, reduced production rate and quality. Each affects capacity in a different way.
1. Start with planned production time
Establish how much time was scheduled for manufacturing. Exclude only the intervals that the indicator’s definition classifies as outside planned production. Use the same criteria across machines, products and shifts to keep availability and OEE comparisons consistent.
2. Separate stopped time from the production rate while running
A 20-minute stoppage and a cycle running 10% slower are different losses. The first requires the duration of the stoppage and its documented cause, where available. The second requires a technical reference for cycle time or speed and the cycles actually observed. For processes manufacturing several products, record the target times and conditions applicable to each.
3. Estimate potential capacity with explicit assumptions
As an illustrative example only, consider a shift with 480 scheduled minutes and 60 minutes of stoppage during production. This leaves 420 operating minutes. If the product’s reference rate is 120 units per hour, the stoppage represents a theoretical opportunity of 120 units, assuming the machine could have maintained that rate. Whether those units would have been conforming, saleable and recoverable depends on quality, demand and other constraints.
4. Assess the economic effect separately from potential units
Multiplying potential parts by their selling price often overstates the economic impact. Assessing commercial value requires actual demand, the ability to recover the volume, contribution margin, incremental costs, scrap and constraints elsewhere in the process. When analysing the direct cost of a stoppage, document the treatment of labour, energy, maintenance and materials. A confirmed financial loss requires this assessment of the economic consequences.
5. Use OEE to structure the causes of loss
OEE combines availability, performance and quality using consistent definitions. Increased operating time produces more conforming units only to the extent allowed by cycle performance and quality yield. The overall figure should therefore be analysed alongside the records explaining its components. See our OEE guide for injection moulding and the industrial productivity application.
What a monitoring system should record
An initial assessment usually benefits from equipment and product identification, planned production time, a cycle signal or record, stoppage events, production count, conforming quantity and intervention records. Some of these fields require operator input or integration with existing systems in addition to automatically acquired signals.
For a more detailed separation of downtime losses and speed losses, see the guide Stoppages or slow cycles?, which explains how to structure the comparison.
The information can support loss analysis by plant management, shift reviews with production or event investigations with maintenance. The project’s purpose should determine the instrumentation.
References
International Organization for Standardization. (2014). ISO 22400-2: Automation systems and integration — Key performance indicators (KPIs) for manufacturing operations management — Part 2: Definitions and descriptions. Standard entry.
National Institute of Standards and Technology. (2016). A hierarchical structure of key performance indicators for operation improvement in production systems. NIST publication.
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