Shigeo Shingo (1909 – 1990) was an Industrial Engineer who worked as a consultant with a number of companies before finally being brought in to further develop the Toyota Production System. His most notable contributions and accomplishments include SMED (quick changeovers), Standard[ized] Work and methods of error-proofing.
These are some of his most famous quotes:
“The most dangerous kind of waste is the waste we do not recognize.” - Shigeo Shingo
“When you buy bananas all you want is the fruit not the skin, but you have to pay for the skin also. It is a waste. And you the customer should not have to pay for the waste.” - Shigeo Shingo
“A relentless barrage of ‘why’s’ is the best way to prepare your mind to pierce the clouded veil of thinking caused by the status quo. Use it often.” - Shigeo Shingo
“Improvement usually means doing something that we have never done before.” - Shigeo Shingo
“The best approach is to dig out and eliminate problems where they are assumed not to exist.” - Shigeo Shingo
“Are you too busy for improvement? Frequently, I am rebuffed by people who say they are too busy and have no time for such activities. I make it a point to respond by telling people, look, you’ll stop being busy either when you die or when the company goes bankrupt.” - Shigeo Shingo
Again, with any of the lean quotes I present, I try to be as accurate as possible. If you see any discrepancies, please email me.
How to calculate OEE:
OEE stands for Overall Equipment Effectiveness and is the most comprehensive calculation used to determine how effectively you are utilizing your equipment. It is an important part of total productive maintenance, can help better calculate efficiency losses, and is useful when incorporated into the cycle time calculations.
In order to calculate OEE, you will need to collect some data:
- PERFORMANCE RATE – The Performance Rate is calculated by looking at the actual operating speeds of your machines in comparison to the operating speeds that they were originally designed for those machines or the products being run on them.
- Product A was designed to run on Machine 1 at speed setting 10, the highest speed possible. Due to the machine’s old age and fragile state, it can only run safely and produce good versions of Product A at a speed setting of 6. The Performance Rate would then be 60% (i.e. 6 / 10
- AVAILABILITY RATE – The Availability Rate is calculated by measuring any production losses due to downtime from equipment failing, breaking down, etc. as a portion of scheduled manufacturing time.
- Machine 1 runs 36 hours for every 40 available manufacturing hours due to breakdowns. The Availability Rate is then 90% (i.e. 36 / 40).
- QUALITY RATE – The Quality Rate is calculated by determining the amount of losses due to quality issues like scrap and rework as compared to the total parts processed.
- Machine 1 ran 100 pieces of Product A, but only 98 met the quality specifications. The Quality Rate would then be 98% (i.e. 98 / 100).
Now, once you have these 3 important measures, the calculation of OEE is very simple:
PERFORMANCE RATE x AVAILABILITY RATE x QUALITY RATE
Using the examples from above (Performance Rate = 60%, Availability Rate = 90%, Quality Rate = 98%):
60% x 90% x 98% = 52.9%
Essentially, the OVERALL EQUIPMENT EFFECTIVENESS (OEE) is the % of effective use that you are getting out of your piece of equipment. It is a compounding, thorough look at your true equipment uptime as a percentage of your total available manufacturing time. This metric is important for loading workcenters and determining capacities because you are completely aware of a particular machine’s (or machine type) total ‘real’ uptime.
