The Amper Way, Part 4: Use OEE to Uncover Production Losses and Opportunities

In Phase 4 of the Amper Way, the focus shifts to monitoring production output, understanding OEE (Overall Equipment Effectiveness), and going paperless. This phase involves leveraging digital tools to uncover whether you are producing pieces in a timely manner, identify losses, benchmark progress, and improve equipment productivity.

Phase 4: Monitor OEE and Production Output

By now, you’ve moved through the Amper Way to uncover how effective your machines and labor are. In Phase 4, we bring it all together to understand OEE, which measures the efficiency of your production line.

OEE is a metric that many factories strive to collect. In most cases, the primary OEE loss comes from availability losses (i.e., utilization). Therefore, increasing machine utilization will have the biggest impact on your OEE and is often the easiest lever to change. This is why Phases 1 and 2 are such an important foundation.

Why You Should Track OEE

When you implement OEE, you can identify, monitor, and reduce the amount of loss your organization experiences over a given period of time, which directly impacts your bottom line. Discovering where your losses are will tell you what corrective action you need to take. Additionally, this key performance indicator (KPI) alerts you as to whether your equipment, workers, and systems meet operational and industry standards.

OEE also allows you to monitor and track progress so that you can eliminate waste within your manufacturing process and make your operations lean and efficient. Keep in mind that having an OEE score lower than 100% doesn't necessarily mean that your equipment fails to meet the established standards. This KPI is merely a benchmark that may indicate that your operations are still new and that there’s room for improvement.

How to Calculate OEE

If you’re new to calculating OEE, or your production processes differ from traditional industry models, then the simple OEE formula could be a good way to determine your OEE score.

OEE performance = (Ideal cycle time * Total number of goods produced) / Run time

The advanced OEE calculation provides you with a bit more in-depth information than the simple OEE calculation, as more factors and formulas are involved. The advanced OEE calculation is:

Advanced OEE = Availability * Performance * Quality

Once you’ve calculated your OEE, you can start taking steps to improve it.

How to Use OEE in Your Factory

OEE data can be used in various ways to improve manufacturing operations and optimize production processes. Some of the things that can be done with OEE data are:

Identify Bottlenecks

By analyzing OEE data, you can identify where the production process is slowing down or where there are bottlenecks. This can help you to make changes to improve the flow of production and increase overall efficiency.

Optimize Production Scheduling

OEE data can be used to optimize production scheduling. By analyzing the data, you can determine the best time to run a particular production process or equipment to maximize efficiency.

Improve Maintenance Practices

Track equipment performance and identify maintenance issues. By addressing these issues early, you can reduce downtime and improve overall equipment reliability.

Reduce Waste

By analyzing OEE data, you can identify areas where waste is being generated and take steps to reduce it. This can help to improve efficiency, reduce costs, and increase profitability.

Identify Opportunities for Improvement

OEE data can be used to identify opportunities for improvement in the production process. By analyzing the data, you can identify areas where performance can be improved and take steps to implement changes that will increase efficiency and productivity.

Overall, OEE data can be a valuable tool for manufacturers to improve their operations and increase profitability.

Tracking OEE with Amper

As mentioned above, OEE takes into account both machine uptime and downtime, ideal cycle times, actual cycle times, and scrap and good parts. So how do we get all this information in Amper? 

Amper’s digital Tally Sheets can collect some of this data from your operators, but you can also automatically count cycle times with our Automated Part Counter. If OEE is an important KPI for your operations, you can use that information to identify where quotes aren’t meeting reality and where you’re least efficient. With that knowledge, you can take action to improve your margins on your production output.

You can use the part performance dashboard in Amper to:

  • Find top-performing and lowest-performing parts and update target cycle times in your ERP to optimize routings for better predictions and quotes
  • Determine whether to only run certain parts on certain machines
  • Understand how each part is performing and find out what are the biggest reasons for downtime for a specific part.
  • Look at OEE by part to see which parts perform the best

Tip: Get your operators on board! Phase 4 requires a little more work from your operators. It's important to get buy-in in the previous phases (through helpful tools and support) to ensure adoption and a successful Phase 4.

Answers Derived from Tracking OEE

In this phase, you'll get answers to the following questions:

  1. Am I on track to finish a job by a designated date and time?
  2. Is availability, performance, or quality affecting my OEE the most?
  3. Are my parts running to rate? Are my machines running faster or slower than expected?
  4. Do certain parts run better on certain machines?
  5. Do I need to change my part routings?
  6. Do I need to be charging my customers more to run certain parts?
  7. Did I hit my throughput goals for yesterday?
  8. Do I make too much scrap of a certain part/part type?
  9. Do certain machines make more scrap than others?
  10. What are my top- and lowest-performing parts and can I update target cycle times in my ERP to optimize routings for better predictions and quotes?

With Phase 4 under your belt, you’ll be one step further in your journey to smooth operations. Having this structured approach to understanding utilization, capacity, paid labor, and OEE will level up your operations and never stop delivering value. Moving on to Phase 5 means you fully understand how to use your data, your operators are involved and engaged, and you’re ready to automate or remove some manual data collection (e.g. through ERP integration).

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