Fogwing Industrial Cloud

How to calculate TEEP


In Manufacturing, when can we say that we are doing our production efficiently? When we do our job well, successfully, in stipulated time without wasting much energy, resources, efforts and time in doing a particular job assigned to us, then we say that our job was done efficiently. Right! If this is the case with human beings, then what about the machineries used in industries / factories? The technical term used to calculate TEEP or to track the performance of all machineries together is called Total Effective Equipment Performance (TEEP).

Total Effective Equipment Performance (TEEP) can be defined as a method of measuring the performance of the machineries against their total capacity, facilitating the manufacturers understand the performance and improve utilization.

TEEP Formula

Before calculate TEEP, we should be aware of the losses in the production plant. There are mainly 2 losses i.e., Equipment Losses (measured by OEE) and Scheduled Losses (measured by Utilization). TEEP can be calculated using the formulae listed below.

TEEP = OEE * Utilization

OEE = A * P * Q (Availability, Performance and Quality)

Utilization = Planned Production Time / All Time


  1. TEEP measures the “Total Calendar Hours” which is truly productive.
  2. OEE measures the percentage of “Planned Production Time” which is truly productive.
  3. Availability is the scheduled time when the production is actually going on.
  4. Performance is the speed of production as a percentage of expected speed.
  5. Quality is the amount of quality products as a percentage of total products manufactured.

In a manufacturing industry, for example, imagine on a normal workday with 2 working shifts. The scheduled operation time is 16 hours (8+8) i.e., 960 minutes. Let the number of pieces produced be 25,000.

When we consider the employee – shift changes and the time machine take to power up, it accumulates to 40 minutes of downtime in each shift (assumption) i.e., 80 minutes. The actual production time is then 880 minutes (960-80).

  1. Availability will be 880 (actual time) /960 (scheduled time) = 0.916. Therefore, Availability = 0.916.
  2. To calculate the performance, let us consider that the ideal production time of each piece is 2 seconds.
  3. Then, Performance will be (2 * 25,000) (number of pieces produced) / (880*60 seconds) (actual production time) = 0.9090. Therefore, Performance = 0.946.
  4. To calculate quality index, consider 25,000 pieces were produced and 480 are defective, then 24520 of these are in perfect condition. The quality index will be 24520 /25000 = 0.98. Therefore, Quality index = 0.98
  5. To calculate OEE, OEE formula is OEE = Availability * Performance * Quality

     i.e., OEE = 0.916 * 0.946 * 0.98 = 0.849

– To calculate TEEP, the formula is

TEEP = OEE * Utilization

– But Utilization = Planned Production Time / All Time = 880 / 960 = 0.916

i.e., TEEP = 0. 815 * 0.916 = 0.7473 (74.7%)


If the TEEP score is 100%, it means that there is no Schedule Losses and no OEE Losses which means the machine produces only Good Parts, as fast as possible, without any stop, working round the clock for 24hrs a day, 7 days a week.


Practically, even the best production plant will have a maximum TEEP ranging from 85% to 90%.

Importance of measuring the TEEP:

  1. The main objective of measuring OEE and TEEP is to understand the reliability of the critical assets in the production plant and determine the losses to analyze the asset and use correct reliability tool to reduce these loses, improve reliability and hence improve the efficiency of the asset.
  2. The greatest value in measuring TEEP is that it captures everything every single minute of time irrespective of the downtime for preventive maintenance (PM) tasks or the time taken to perform a product change in the schedule as part of OEE or TEEP.
  3. By knowing OEE and TEEP, the manufacturers can accurately forecast, schedule and plan the production with high degree of accuracy. This enables them schedule what and how much production can take place in that specified time.
  4. TEEP gives an insight regarding each of the loss categories, quality, speed, operational and planned activities, helping the user take appropriate decisions on improving the efficiency of production.
  5. TEEP is used to get a sense of potential sales capacity as it contemplates the full capacity of the manufacturing plant.

Industry 4.0 aiding to TEEP

There has been a significant transformation in the industrial areas regarding the way manufacturing industries produce the product and the credit goes to digitization of manufacturing. Industry 4.0 represents the 4th revolution that has occurred in the manufacturing industries. Let us briefly see how industries have arrived at the 4th revolution.

  1. First revolution – Mechanization through water, steam and atomic
  2. Second revolution – Mass production using electricity and advanced machineries.
  3. Third revolution – Employing computers and automation, converting the factories into smart factories.
  4. Fourth revolution – Network of machines and computers digitally connected with one another to create and share information. It is fueled up with data and machine learning along with Artificial Intelligence (AI) to take decisions without human interventions.
  5. A key component of Industry 4.0 is the Internet of Things (IoT) that is exemplified by connected devices. Enormous data is collected from the devices and is stored in the cloud environment. Data metrics can be drawn at any point of time and hence operations can be optimized by leveraging the insights to the device performance.

By calculate TEEP and OEE aided with Industry 4.0 enables the manufacturers optimize their operations more effectively and efficiently to monitor the machine utilization. This technology provides more reliability in productions by viewing utilization metrics in real time from anywhere across the globe. It gives an insight to the production performance which helps in assessing production schedules, forecast the demand, enhance manufacturing process, increase the product quality, improve the efficiency of manufacturing process and therefore hit the peak utilization of the machineries. is a complete solution implanted with Industry 4.0 with the calculations of TEEP and OEE helping the factories become smart. helps monitor the performance, device reliability, productivity, its peak utilization, quality metrics etc. This helps the product Engineers take appropriate decision to extract peak level of performance using least number of inputs to gain maximum output.

Some of the key features of are:

  1. Work Order Management
  2. Jobs Tracking
  3. Asset Runtime Monitoring
  4. OEE Metrics Reporting
  5. Preventive Maintenance
  6. Downtime Alert Notification
  7. Role Based Dashboard
  8. Maintenance Scheduler
  9. Activity Log and many more.

For more information on, please visit our website link below.


In most of the manufacturing industries, equipments’ are not used to its full capacity. Measuring the TEEP and OEE gives clarity on the asset performance to its total capacity to understand the performance, loses and peak utilization of the assets. This helps the manufacturers take appropriate decision in improving the production, asset management, predict production time, avoid loses thereby improving the efficiency of the plant. entrenched with Industry 4.0 is the new sunrise area in manufacturing industry which enhances the factories with smart and autonomous systems powered by data and machine learning. Determining the TEEP and OEE gives an in-depth knowledge of what exactly is happening in the production plant, what is the production capacity, what is the actual production rate, what improvements is to be incorporated to improve production, predict the quality and rate of production etc. taking industry standards to different heights.


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