What is OEE and how to calculate it
OEE measures how much of a machine's capacity turned into good parts. Three losses, one multiplication and a number that shows where the shift is leaking — here's the calculation, with an example, the way it's done on the shop floor.
The formula
OEE stands for Overall Equipment Effectiveness. It's the product of three factors, each between 0 and 100%:
OEE = Availability × Performance × Quality
Multiplying rather than adding is what makes OEE useful: a small loss in each factor becomes a big loss overall, and the final number never hides which of the three is worst.
Three losses, one per factor
Each factor captures a different kind of loss. Looking at all three separately is what turns OEE from a score into a diagnosis.
Availability — was the machine running?
Run time divided by planned production time. This is where unplanned downtime goes: breakdowns, material shortages, missing operators, changeovers that take longer than planned.
Performance — did it run at the right speed?
Actual output divided by what the run time allowed at ideal speed. This is where slow cycles and the few-second micro-stops nobody records go.
Quality — was the output good?
Good parts divided by total parts produced. This is where scrap and rework go — which many plants count as output and then can't explain the number.
A worked example
An 8-hour shift with a planned 30-minute meal break. The machine's ideal cycle is 1 part per minute.
- Planned time
- 480 − 30 = 450 min
- Unplanned downtime
- 45 min (breakdown 30, material shortage 15)
- Run time
- 450 − 45 = 405 min
- Availability
- 405 ÷ 450 = 90%
- Parts produced
- 344 (405 would fit at ideal speed)
- Performance
- 344 ÷ 405 = 85%
- Good parts
- 337 (7 scrapped)
- Quality
- 337 ÷ 344 = 98%
OEE = 0.90 × 0.85 × 0.98 = 75%
Notice what the single number hides and the breakdown reveals: quality is excellent, availability is reasonable, and the biggest loss is performance — 61 parts that fit in the time and never came out. Without sensors this loss is usually invisible: micro-stops and reduced speed that nobody writes down. That's exactly when reading the PLC or a sensor starts to pay off.
OEE calculator
The same calculation as above, with your numbers. Five fields, instant result, and the factor with the biggest loss highlighted.
Shift OEE
75%
- Availability
- 90%
- Performance
- 85%
- Quality
- 98%
- Run time
- 405 min
- Possible at ideal speed
- 405
- Good parts
- 337
The biggest loss is performance: the machine ran, but slowly or with micro-stops nobody wrote down. This is when reading the PLC or a sensor starts to pay off.
World-class benchmark: 85%. The real industry average is close to 60%, and a first measurement usually lands between 40% and 60%.
Want this number every shift, without spreadsheets?
We build systems that calculate OEE per shift and per machine from operator input and, where it makes sense, directly from PLC data.
See industrial softwareThe mistakes that make OEE lie
Almost every OEE that “doesn't add up” comes from one of these five. Worth checking before blaming the machine.
- Calculating against 24 hours instead of planned time — OEE collapses and nobody trusts it.
- Ignoring micro-stops. Ten 40-second stops per hour add up to 11% of availability lost without a trace.
- Counting rework as a good part the first time and finding the scrap at month-end close.
- Measuring once a month, on paper. The number arrives when it's too late to react to the shift that produced it.
- Comparing OEE across machines with different cycle times without looking at the three losses separately.
Frequently asked questions
- What is a good OEE score?
- The international world-class benchmark is 85% — roughly 90% availability, 95% performance and 99% quality. But the real industry average is well below that, around 60%, and a plant that has never measured usually finds numbers between 40% and 60%. That isn't bad: it's the starting point. The value of OEE isn't in being high, it's in showing where the loss is.
- What's the difference between OEE and TEEP?
- OEE measures effectiveness within the time you planned to produce. TEEP (Total Effective Equipment Performance) measures against the whole calendar — 24 hours, 7 days. An OEE of 75% on a single shift can be a TEEP of 25%. OEE answers “am I using my planned time well?”; TEEP answers “how much capacity is sitting idle?”.
- Do I need sensors or PLC data to measure OEE?
- Not to get started. You can calculate it from manual records: start and end times, stops with a reason, parts produced and scrapped per shift. What a sensor or PLC data adds is the part manual tracking misses — micro-stops and actual speed — and the math stops depending on someone remembering to write it down. The usual path is to start by hand on one machine, prove the number is useful, then automate the data collection.
- How often should OEE be calculated?
- Per shift, at minimum — because the shift is when you can still act. Monthly OEE is fine for reports and useless for operations: by the time the number arrives, the cause is gone. Monitoring systems calculate it in real time, but even a sheet filled in at the end of each shift changes the conversation with the team.
- Is OEE useful for small plants?
- Yes — arguably more than for large ones, because one idle machine weighs more on a plant with three machines than on one with thirty. The difference is the scale of measurement: one machine, one shift, one sheet. What doesn't work is waiting to “get bigger” before you start measuring; the plants that measure are the ones that grow.
- Where does Volvi come in?
- We build systems that calculate OEE per shift and per machine from operator input and, where it makes sense, direct PLC data — with standardized stop reasons, alerts and history. Half of our team spent 25 years inside manufacturing, so the first conversation is about your process, not software. If a spreadsheet solves your case, we'll tell you.
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Tell us how many machines you have and how production is recorded today. We reply within one business day with a path forward — starting with one line, not the whole plant.
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