Six Big Losses in Manufacturing: How to Improve OEE

The Six Big Losses in ProductionIf you work in manufacturing, you are always looking for ways to increase productivity. Enter, the Six Big Losses model. 

Many organizations use OEE (overall equipment effectiveness) as a key measurement of efficiency and it is easy to see why.  It provides an easy-to-understand score, and a roadmap for improvement in the form of the six big losses which are directly tied to productivity data.

We’ll review each of the Six Big Losses in detail, and provide numerous solutions for each. What more could you ask for?

OEE in manufacturing 

Overall Equipment Effectiveness is a quantifiable (i.e., uses numbers) way to find out how well your equipment, people, and processes do their job by measuring:

  • available time/uptime (availability)
  • production speed and consistency (performance)
  • the number of defects (quality)

OEE uses these performance metrics to find the percentage of good production time on an asset. It can also help answer some of the most confounding questions about production efficiency. 

  • How do you know when you’re doing enough to be as efficient as you can be? 
  • How much deviation from the ideal level of productivity is OK? 
  • When you stray too far from your ideal productivity, how do you even begin to find the root cause so that you may address it?

Calculating OEE at your organization is an important first step in understanding where you are starting from. That is why it is an essential element of well-respected strategies such as Total Productive Maintenance (TPM) and Lean Manufacturing.

It can also help you identify which of the losses discussed below are the most important for you to address first and why. 

The Six Big Losses

OEE is not the car that will drive improvement at your organization – you are. But OEE does provide the roadmap to get you where you want to go. 

The road to get to your OEE score may feel long and littered with mathematical twists and turns. The truth is, those twists and turns – each number and formula you used to do your OEE calculation – clearly tell you how to improve. 

This is the real goal of OEE – to help you address the “Six Big Losses.” 

The Six Big Losses are the problems that most commonly cause inefficiency and waste in manufacturing. They fall into three groups and – surprise! – if you’ve taken the time to calculate your OEE score, you already know what they are:

  • Availability Losses
  • Performance Losses
  • Quality Losses

oee six big losses

The Six Big Losses. Source: OEE.com

Next, we’ll go through all three categories, tell you what the Six Big Losses are, and how to address them. Because they all feed directly into your OEE score, you’ll see your OEE score rise over time as you fix them.

The Essential Guide to CMMS

The Essential Guide to CMMS

How to reduce Availability losses 

The first two of the Six Big Losses fall under your score and have to do with keeping your process up and running as much as possible. If your availability score is low, dig into your run time and plan production time numbers.

Schedule loss is not taken into account for OEE calculations as there is no point in measuring OEE at times when production isn’t even supposed to run. Schedule loss is used for calculating TEEP (Total Effective Equipment Performance).

Big Loss #1: Equipment breakdowns (unplanned downtime)

Equipment breakdowns are your most significant source of unplanned stops and idling. If unplanned downtime is what is dragging down your operating time, this is where you need to start. 

The solutions are:

  • Implement an easy-to-use CMMS like Limble. It will help you make the most of your PM, reduce breakdowns, and maximize equipment performance.
  • Track your downtime. Most CMMS software have modules for tracking shutdowns and their reasons. Limble makes this simple with Custom Dashboards that allow you to pull reports on equipment problems automatically. They help you identify the biggest issues, so you can either repair or replace them at the right time.
  • Forecast and implement measures to prevent shutdowns. Once you find patterns in your downtime, you can avoid them. If a piece of equipment breaks down after a certain period of run time, plan your shifts around that until you have a more long-term fix.

Big Loss #2: Setup and adjustments (planned downtime)

Equipment setups and adjustments take time. There is no getting away from them. The good news is that they give us room to improve. Do them at the right time – in the right way – to minimize production losses. 

Here is how to reduce the frequency and length of these planned stops: 

  • Bigger batches mean fewer batches – and fewer equipment changes on your shop floor. If you can closely predict the total units you eventually need, you can plan your production much more efficiently. (If you are using a continuous production system, you won’t have to think about this.)
  • Implement Single-Minute Exchange of Die (SMED) technique. The SMED technique is a principle of lean production. Take a close look at what happens during your planned stops. Look for ways to eliminate or shorten steps. Your goal is to perform stops as quickly as possible – as close to one or single-digit minutes as you can.

How to reduce Performance losses

The next two of the Six Big Losses fall under your performance score and have to do with speed. Addressing these two losses helps you maximize your production.

If your performance score is low, look into the consistency of your run time and cycle time numbers. 

Big Loss #3: Minor stoppage

Minor stops are hard to monitor and can seem unimportant. The truth is, many little stops happening in a large-scale manufacturing process add up quickly. Here is where to start.

Address deviations in real-time

Train machine operators to fix more minor issues on the spot. This is the foundation for autonomous maintenance (“AM”) and saves a lot of time. Your maintenance team is freed up for more serious equipment failures, and your production team doesn’t need to wait to fix a minor breakdown. 

If you have a CMMS like Limble, you have an excellent tool at your disposal to start AM. By giving them access to Limble, they can have all the help and instruction they need at their fingertips with the mobile CMMS app.

Track patterns of performance loss

When are minor stops or slow cycles most likely to happen? Patterns in this data can help you find and prevent the root cause. 

  • Does production go down during a particular shift? 
  • After routine or planned maintenance? 
  • After a certain amount of run time?

Standardize processes

There is a reason SOPs exist. They are usually well-researched and thoroughly tested. We’ve said it before, and we’ll say it again: Follow the same process, every time. This leads to fewer mistakes and minor stops and is why many organizations work toward process automation whenever they can.

Big Loss #4: Reduced speed

Speed loss is nearly always the result of wear and tear, poor maintenance, or misuse. This is one area where we humans can relate. 

As we get older, we tend to get a bit slower. But if we have a good workout regimen and take care of ourselves, we can keep plugging along at a good pace for a long, long time. 

Optimize your production cycle and speed

Do the same for your equipment. Keeping it in tip-top shape is the best thing you can do to help it maintain its production speed. 

Do what you need to do to shore up your PM program. Train your machine operators to use the equipment properly and take care of it. Give it a name and buy it flowers if you want to. The point is, treat it well. 

How to reduce Quality losses

A Quality rating of less than 100% means your production process results in some defective goods. 

The lower the quality score, the higher the percentage of defective parts. Look at the production processes and equipment in places where your quality score is lowest. 

Big Loss #5: Product scrap

Most defects are the result of deterioration in your equipment. Track the types of defects you see and closely monitor aging equipment. 

You may have a highly skilled maintenance team that can keep equipment running. But there will come a time when the reduced speed and amount of defects and rework will not be worth keeping the asset online. It will simply make more sense to replace it. 

Big Loss #6: Startup scrap

Reduce startup production

It is easy to get excited when you finally replace old equipment. The old one may have been so slow and inefficient for so long that you feel like you have to make up for lost time. 

Resist the urge to kick it into high gear right away. It may take a few batches before the product meets your quality standards. 

In the meantime, stick to smaller batches. It will allow you to find and fix problems before running full steam, saving time and materials from startup rejects.

Reduce quality variation 

Once the new equipment is set up and running well, don’t assume it will stay that way. Settings find ways of shifting, and materials change over time. Check both often in the early days so that you can resolve any changes quickly. 

Conclusion

Excellent maintenance and manufacturing teams practice consistency, leverage the right tools, and prioritize continuous improvement. 

A CMMS like Limble can be the key tool in addressing some of the most common productivity losses. We offer an easy-to-use platform that enables consistency, reporting, and efficient maintenance. You can start a free trial here, request a demo, or even try out our online self-demo.

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