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How to calculate OEE of machine

How to Calculate OEE?

Before we get into how to calculate OEE of machine, Let’s understand the fundamentals of OEE. OEE stands out as Overall Equipment Effectiveness, a metrics that combines various parameters of machines performances to arrive a measurable production efficiency.  Manufacturers and Machine Operators refer these metrics to make decision on operational performance optimization. 


OEE is the most common industrial standard that followed for many years as practice. However it has been calculated manually and periodically due to lack of realtime data availability.  Also these metrics are not analyzed compared with other operational metrics to identify the overall effectiveness of the plants. The Industrial IoT based IT / OT integration helps to gather machine performance data at realtime, compare with other data sets, which helps to calculate the relative impacts at realtime. 

OEE Calculation

OEE is a single value that arrived by combining the machine’s availability, machine’s operating hours and quality of parts produced by the machine within the available time.  By combining all of these machine parameters, the simple formula is below. 

					OEE % =  Availability x Performance x  Quality

To arrive the machine availability, performance and quality components, we have to measure each one separately based on the manufacturing operating model.

how to calculate OEE of machine

Availability Calculation:

To identify the availability of machines, we have to structure the shift hours and duration of the machine operating. The planned production time is define by plant administration based on the work orders and workforce capacity etc. The planned production time should be considered in minutes for accuracy. 


The formula to arrive availability is to subtract the actual operating hours of the machines against planned production time. 

					Availability % = Operating Time / Planned Production Time

To give further clarity, Let go through an example of a production house.  The planned production time is an actual time planned to operate the machine. If a factory is operating 8 hours per shift with 30 mins break time, the actual planned production time in minute is 450 (by subtracting 30 mins from 480 minutes).  


The actual hours operated by the machine operator might vary depending on the various conditions during the production. The material loading, refilling,  part changes, maintenance check and many other activities might impact the production time.

					Example:  430 mins / 450 mins (8 hours with 30 mins break) = 95.55%


Performance Calculation:

Performance of the machine is calculated based on how the equipment operated to produce parts in the given time period.  Here, key input to calculate the performance is to identify “ideal cycle time” of the production. The ideal cycle time is considered as estimated time required by machine to produce each part. 

To identify the capacity of a machines required to consider the ideal cycle time and planned production time to arrive the overall capacity. 

					Performance % = Total Produced / Capacity 

In order to identify the performance of machine per day, Let’s assume that if the Ideal Cycle Time of the production is 1 part per minute and the planned production hours is 7.5 hours then total capacity of the machine is 450 items per day. 

					Example:  410 parts / 450 parts (based on 1/1 ideal cycle time) = 91.11%


As per the above example, if the machine produced 410 parts per day against estimated 450 parts as capacity, then performance of the machine will be 91%.

Quality Calculation:

Quality of the production is simplest one to measure in industry. To calculate quality of production, identify total quality parts produced out of overall production quantity. 

					Quality % = (Total Produced – Total Scrap) / Total Produced 

As per our example, if the machines produced 410 parts, out of which 10 parts are scrap then total quality production is 400 parts only.  

					Example:  410 parts – 10 Scrap / 410 parts Produced = 97.56%


Finalizing the OEE by combining all metrics:

Let consolidate each of the three parameters into the OEE formula to arrive the Overall Equipment Efficiency (OEE) of the machine.

					Availability = 95.55%
Performance = 91.11%
Quality = 97.55%

OEE % =  Availability  x Performance  x Quality

OEE = 0.95 x 0.91 x 0.97

Final OEE % = 83.85% 

OEE metrics are great way to understand the machine production performance. However it is just a number that indicates the performance. But to understand the root of the OEE value, it is required to measure other data points from the production environment. Example: 


The frequent unplanned downtime and maintenance activities might impact the OEE value directly. Monitoring and measuring the downtime, quality roots and maintenance planning are all critical to optimize the production efficiency.  All of these metrics cannot be measured manually. is the comprehensive solution for measuring the OEE metrics along with other performance and loss metrics to improve the production performance accurately. 

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