OEE is a powerful metric used in manufacturing and industrial automation to measure how effectively a machine or production line is being utilized. It reflects how well equipment contributes to the production process and highlights where improvements are needed.
A high OEE value indicates efficient use of equipment, while a low OEE signals potential problems in availability, performance, or quality. By understanding and applying OEE, companies can identify bottlenecks, reduce waste, and continuously refine their manufacturing processes — all essential for improving operational efficiency.
Advanced industrial automation solutions are improving the way how manufacturers monitor and enhance their OEE. Modern sensors, IIoT platforms, and AI-based analytics continuously collect real-time production data, enabling teams to identify bottlenecks immediately and act before they impact output.
Technologies and strategies like predictive maintenance, digital twins, and on-prem or cloud-based monitoring platforms empower companies to:
With these innovations, managers gain a clear view of machine effectiveness across the production line, while technicians have actionable insights to keep equipment running at peak capacity. This synergy of technology and OEE metrics helps companies achieve continuous improvement and maintain a competitive edge.
The OEE calculation is based on three key components:
1. Availability
Availability measures how much time the machine is actually running compared to the planned production time. Unscheduled downtime, such as breakdowns or maintenance issues, reduces availability.
Formula:
Availability = Actual Operating Time / Planned Production Time
2. Performance
Performance evaluates whether the equipment is running at its maximum speed. Any slowdowns, aging effects or short stops will lower performance.
Formula:
Performance = Units Produced / Theoretical Units Possible
3. Quality
Quality assesses the proportion of products that meet required standards. Defects and rework lower the quality score.
Formula:
Quality = Good Units / Total Units Produced
Calculating OEE involves three main steps:
1. Data collection
Record actual production time, downtime causes, machine speed, and product quality data. The more accurate the data, the more meaningful the OEE result.
2. Calculation of each compenent
3. Combine the results
Once the three components are calculated, multiply them to get the final OEE:
OEE = Availability × Performance × Quality
A score of 100% indicates that the equipment is producing only high-quality parts, at maximum speed, without any downtime. An OEE above 85% is widely regarded as excellent in most literature. But it’s important to note that optimal values can vary significantly depending on the specific industry segment and production environment.
The following table is based on a synthesis of ranges published by leading industrial automation companies, OEE software providers, manufacturing research sources plus the authors MBA dissertation thesis.
The concept of OEE originated from the Total Productive Maintenance (TPM) methodology developed in Japan in the 1960s and 1970s. TPM aimed to maximize equipment effectiveness by involving all employees in proactive maintenance and continuous improvement. OEE became the key metric to measure how well TPM principles were being applied.
Today, OEE remains a cornerstone of lean manufacturing and operational excellence initiatives worldwide, serving as a universal language for measuring productivity in automated production environments.
For manufacturers striving to maximize productivity and operational efficiency, Festo delivers innovative industrial automation solutions specifically designed to monitor and improve. Many customers have already achieved OEE improvements of up to 10% by integrating Festo technologies into their production systems.
Our portfolio ranges from high-performance hardware solutions, engineered and optimized with our advanced design software and decades of application expertise. It also includes AI-powered applications for predictive maintenance of pneumatic and electric drives, which customers can easily deploy even without in-house AI expertise.
All Festo technologies integrate seamlessly into existing production environments, providing real-time data, actionable insights, and intelligent diagnostics that help you reduce downtime, optimize performance, and enhance product quality. With Festo, improving your OEE becomes a tangible, achievable goal — driving your production toward world-class efficiency.