How to Improve OEE and Better Use Your Production Capabilities?
How to improve OEE when energy costs keep rising? Increasing prices of utilities, pressure for stable production and the need for better use of machine resources… You probably know it all too well, and you’ve been wondering for a long time how to increase production efficiency. It’s time to look at OEE – one of the key foundations of performance management in manufacturing. This indicator becomes especially important when a company notices growing downtime, reduced productivity, or difficulties in maintaining the expected quality. OEE helps structure these issues and shows how the production line truly operates.
In this article, I explain step by step what OEE is, how to calculate it, what the typical causes of low results are, and what actions companies take to genuinely increase machine efficiency, reduce time losses and improve equipment availability.
What is OEE?
OEE (Overall Equipment Effectiveness) is a synthetic indicator that shows to what extent a company uses its production resources. It consists of three elements:
- Availability – how much time (relative to the initial plan) a machine is ready to work.
- Performance – whether the machine operates at its intended speed.
- Quality – what percentage of manufactured units meet quality requirements.
OEE is a global standard widely used in TPM (Total Productive Maintenance). For many years, it has been a core element of Lean Manufacturing and Industry 4.0, because it allows different types of losses to be captured in a single model.
Most importantly, OEE does not tell you how much you produce, but how well you use your capabilities.
How to calculate machine efficiency?
Many manufacturers struggle with calculating productivity indicators. Fortunately, the OEE formula is universal:
OEE = Availability × Performance × Quality
Each of these components has its own method of calculation:
- Availability = (Actual operating time / Planned operating time)
Strongly influenced by failures, changeovers, administrative and technical downtime. - Performance = (Actual output / Theoretical output at 100 percent speed)
The most common losses come from machines running below nominal speed or from micro-stops. - Quality = (Good products / Total production)
This includes scrap, rework and process defects.
Today, manufacturing companies use two main approaches to calculating OEE:
- Manual reporting – spreadsheets, shift reports, paper documentation.
This method is highly error-prone and usually underestimates real losses. - Automatic data collection (SCADA/MES) – OEE is calculated based on real machine data.
Automated collection significantly reduces measurement errors and speeds up detection of process deviations.
Most common causes of low OEE
Worried about low OEE? You need a diagnosis and the right “treatment”. In medium and large companies, the sources of losses tend to repeat. Below are the most common issues:
- Unplanned downtime
Failures, lack of spare parts, delayed maintenance. According to TPM principles, availability depends heavily on technical condition and maintenance discipline. - Planned and organisational downtime
Changeovers, material shortages, waiting for decisions or operators. - Micro-stops and speed losses
These small interruptions are barely visible in paper reports, but monthly they may account for 20–40 percent of lost production time. - Quality issues
Scrap, rework, long warm-up times, inaccurate settings. - Lack of consistent reporting
Incomplete data, delays, and inconsistent interpretations lead to distorted OEE results.
Four actions to increase equipment availability
If you want to improve OEE, start with availability. Downtime is easiest to identify and brings the fastest return on improvement initiatives.
- Improving maintenance schedules
Regular and predictive maintenance reduces failures. Real-time machine data from SCADA or MES helps detect anomalies earlier. - Standardising changeovers
The SMED method (Single Minute Exchange of Die) shortens changeovers by 30–70 percent. Shorter changeovers mean more effective machine operating time and easier production scheduling. - Electronic notification systems
Automated issue reporting speeds up maintenance response and shortens downtime. MES identifies recurring errors and helps find root causes. - Better work organisation
Consistency of data between shifts, clear instructions and unified definitions of downtime improve OEE reliability and corrective actions.
Methods to improve quality and performance
Once downtime is under control, it’s time to improve quality and performance.
- Eliminating production errors
Digital work instructions, process parameter monitoring and automated readings reduce defects. SCADA monitors parameters in real time; MES links quality to batches, operators and machine settings. - Reducing micro-stops
Manual systems fail to capture micro-stops. Automated OEE systems show how much time is really being lost, enabling predictive analysis and adjustments. - Optimising machine speed
Comparing actual and theoretical speeds reveals hidden reserves. Often the limitation lies not in the machine itself, but in workflow organisation. - Using historical data
MES and SCADA allow long-term trend analysis and help detect recurring issues. Continuous measurement is key, not one-time audits.
MES or SCADA – what to choose?
The choice depends on organisational maturity, production scale and analytical needs. So when should you choose SCADA, and when MES?
SCADA is best when you need:
- real-time monitoring of technological parameters,
- quick detection of deviations and alarms,
- machine-level analysis without full organisational context.
MES is the right choice when you want to:
- measure full machine OEE across shifts, batches, operators, materials,
- automate reporting,
- track production, genealogy, quality control,
- optimise the entire production chain, not only one workstation.
Raising OEE is not a one-time effort but a process. It starts with accurate measurement, followed by elimination of downtime, performance optimisation and quality improvement. Automated data collection provides the fastest results, eliminating reporting errors and revealing previously hidden losses.
Companies investing in SCADA or MES make faster decisions, use their resources better and optimise their production processes. This directly translates into savings, process stability and predictable output.
Looking for a way to increase OEE in your company? Schedule a consultation with an explitia specialist.
