“Calculating the Real Value OEE
Brings to Your Company”
Robby Martin
Bush Brothers & Co
Steve Schlegel
AIOE
Industry Leadership
AIOE Platinum Partner
Industry Leadership
You
Your Company
Your Industry
Communities of Practice
Available now for Free Download
Capacity Utilization Loss
OEE Loss
Net Good Production
Off-Quality
Rate Loss
Unplanned Downtime Events
Planned Downtime Events
OEE Production Potential
Lack of Demand
Calendar Production Potential
OEE Loss Buckets
OEE Impact upon Business Results
Enterprise Value / Share Price
Cash Flow
Sales Growth
Safety &
Quality
Cost
Reduction
Process Reliability Improvement
Overall Equipment Effectiveness
Capital
Efficiency
Fundamental Cost Relationships
Raw
Material
Labor
Expense
Line
Productivity
(OEE)
Volume &
Mix
Utilities
Unit
Cost
Overheads
2012
2011
Establish Standard
Definitions,
Calculations, and
identified Data to
be collected
Identified
Stakeholders
Benefits,
Developed Usage
Methodology, and
Established
Guidelines for
Data Collection
2013
Developed OEE
Opportunity
Calculator and
the OEE Tool
Chest
The Path to Now
Developing and Enhancing OEE in CPG Companies
The Top of the Chest : Beginning the Journey
• Definitions
• How to Begin
• What Data to Collect
• Guidelines
• How to Report
• How to Collect Data
The Middle Drawers: Building the Culture
• Obstacles &
Solutions
• Automating
Data Collection
• Identifying Stake
Holders
• Showing the
Value
• Developing a CI • Establish Plant
Culture
Champion
The Base Drawers: Winning the Game & Showing the Value
•
•
•
•
•
•
•
•
Ideas
Cases
Resource links
Formulas
Forms
Calculators
Opportunity Estimator
Tools
CI
Corporate
Plant
Management
Engineering
Maintenance
Quality
Supply Chain
Front Line
Supplier
What is the worth of 1% OEE?
• Identifying OEE is one of the BIGGEST challenges
• Multiple Uses
–
–
–
–
Justifying a capital project
Yearly improvement targets
Designing & Launching Process Modifications
Etc.
• Too Many Versions
–
–
–
–
No consistency
Looked at from one view point
Missing key inputs
“Wanting to make me look better”
Quick & In the Ball Park
OEE OPPORTUNITY CALCULATOR
Basic Financial Data
Units Produced
Raw Material $000
Production Labor Wages & Benefits $000
All Other Product Cost Elements $000
Cost of Goods Produced $000
Raw material efficiency loss %
Raw Material Opportunity $000
Production work center efficiency loss %
Labor Opportunity $000
Minimum Potential Savings
Improvement (10%, 25%, Target)
Raw material efficiency improves to
Work Center efficiency improves to
Raw Material Yield
Production Labor
Total Savings
Total
$/Unit
Detailed Study
OEE CALCULATOR VALIDATION
Industry Guidelines: Next Generation
• Developing a standardized tool to estimate
the Value of Reliability Improvement for the
CPG Industry
• Natural Progression for the ORSG Team
• This process has built a Strong Base
• Now it’s time to move it forward again
OEE Tool Chest: Resources Available Now
OEE Opportunity Calculator
Basic Financial Data
Units Produced
Raw Material $000
Production Labor Wages &
Benefits $000
All Other Product Cost
Elements $000
Cost of Goods Produced $000
Total
OEE Guidelines Paper
$/Unit
OEE Stakeholder Value Guide
Raw material efficiency loss %
Raw Material Opportunity
$000
Production work center
efficiency loss %
Labor Opportunity $000
Minimum Potential Savings
Improvement (10%, 25%,
Target)
Raw material efficiency
improves to
Work Center efficiency
improves to
Raw Material Yield
Production Labor
Total Savings
pmmi.org/aioe
FAQ’s
15
AIOE: More Information
Contact:
sschlegel@pmmialliance.org
Or
pmmi.org/aioe