Should Companies Be Using OEE to Measure Performance?

Do plant managers understand how OEE is calculated and what it means?

Total Productive Maintenance (TPM) has become a buzzword in lean and a generally accepted metric is Overall Equipment Effectiveness (OEE).

However, Ignacio S. Gatell, on our LinkedIn site The Toyota Way site wrote a sacrilegious blog about “How OEE will NOT help you.” He questions whether companies using OEE really understand it, can explain it clearly to their customers, and understand what it means to compare OEE as a KPI across plants. He questions whether even plant managers understand how it is calculated and what it means.

He makes some excellent points, but one sticks out for those who use OEE to compare performance using it as a KPI. OEE performance is relative to a baseline for a given piece of equipment; therefore it is specific to that equipment and not comparable across departments or plants.

Read more about OEE on IndustryWeek.

IndustryWeek is an NED companion site within Penton’s Manufacturing & Supply Chain Group.

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