What is OEE, TEEP and OOE?


One of the most commonly used metrics to measure performance is the Overall Equipment Efficiency (OEE). The OEE is calculated based on the performance, availability and quality of the machine. There are two more indicators, the TEEP and the OOE, and they’re also calculated by using the same factors. So what’s the difference between OEE, TEEP and OOE?

What is OEE?

As explained above, the OEE analyses the performance (production capacity), the quality of the machine (number of good parts) and the availability of the machine. The availability is calculated by matching the actual production time against the planned production time.

Let’s look at an example of how to calculate OEE

Imagine a normal workday:  9:00 -18:00 with a 1-hour lunch break. The scheduled operations time is 8 hours – 480 minutes. However, when you add up employee shift changes, the time the machine takes to power up, etc., all of this lost time accumulates to 47 minutes of downtime meaning so the actual production time is 433 minutes. As a result, the availability equates to 433/480 = ~0.902 (90.2%)

During that day, 19690 pieces are produced. 19270 of these are in perfect condition and 420 are defective. The quality index will be 19270/19690 = ~0.979 (97.9%)

Now, to calculate the performance, let’s consider that the ideal production time of each piece is 1.3 seconds. We need to multiply this time by the number of pieces produced and divide that by the actual production time: (1.3* 19690) / (433 * 60) = 25597/25980 = ~0.985 (98.5%)

The OEE would then be 0.902 * 0.979 * 0.985  = ~0.87 (87%)

What is TEEP?

The major difference between OEE and TEEP is the time taken into account when calculating availability. While the OEE calculates availability by taking into account only the planned production time, TEEP uses all available time – that is, 24 hours a day, 365 days a year. The formula is as follows:

How to calculate TEEP

Let’s continue with the same example. After detecting that one of the biggest issues with the factory was too much downtime, the maintenance manager took steps to improve that matter. A few months later, the average downtime per day was only 20 minutes.

This means that the actual production time has risen to 460 minutes. Consequently, availability became 0.958 (95.8%).

Additionally, the number of pieces has risen to 20936 pieces per day – of which 20307 pieces are in good condition and 629 are defective. The quality score is 0.97 (97%). The performance remained stable at 98.6%. The daily OEE became 91.6%.

The TEEP, is = 0.986 * 0.97 * (460/24*60) = ~0.306 (30.6%). This means that the company still has plenty of room to grow — even without acquiring new equipment or facilities.

We see that he OEE gives you an idea of the maximum production capacity, whereas the TEEP is a good indicator of the scalability of your business. If you have a high OEE but a low TEEP, it’s time to consider extending shifts, creating a new shift (for example, at night) or start operating on weekends.

If both indicators are high and you still can’t meet demand, congratulations! Your business is growing and needs new means of production soon.

What is OOE?

We can’t end this article without mentioning OOE. Again, the difference lies in how we calculate the availability of certain equipment:

While the OEE takes into account the planned production time, in the OOE we use the time each shift takes, even if the machine is stopped for a repair or inspection.