OEE means Overall Equipment Effectiveness. It’s a measurement widely used as a KPI in Total Productive Maintenance (TPM) strategies, Lean Manufacturing, and Lean Six Sigma. OEE calculation is the product of availability, performance, and quality, so it answers three main questions:

  • how often is a piece of equipment available to work? 
  • how well does it work when it’s running? 
  • how many products does it manufacture per cycle?

When you’re trying to improve OEE through lean programmes, your focus should be on eliminating waste. Specifically, you’ll need to tackle losses of OEE that compromise availability, performance, and quality. These are collectively known as the Six Big Losses of OEE. Here’s how each of them factors in (and decreases) OEE calculation:

  • availability: breakdowns (unplanned stops) + setup & adjustments (planned stops)
  • performance: idling and minor stops (small stops) + reduced speed (slow cycles)
  • quality: defects (production rejects) + reduced yield (startup rejects)

What are the Six Big Losses of OEE? And how can you avoid them?


Breakdowns are sudden, major mechanical failures that make machines unavailable. This is the first big loss of OEE that you should eliminate because it lays the groundwork for all the others. (After all, if the machine is not running, we can’t talk about performance or quality.) 

We’re guessing that you already know that preventive and predictive maintenance are more effective in preventing unplanned downtime than reactive maintenance, which relies on “wait and see”. But since even the best preventive plans have their faults, we have another piece of advice for you. Look at data regarding downtime and figuring out the reason or root cause behind each major failure event. Once you understand what’s causing the biggest breakdowns, start working on eliminating the causes. Root cause analysis didn’t become one of the most popular tools for continuous improvement by accident! 

Setup and Adjustment

“New is always better” is not only a dangerous motto to live by, it’s also untrue. As we can see in the bathtub curve, there’s often an adjustment period when a new asset is installed or after it’s overhauled. In fact, every time you need to change a part or machine tooling, there’s a readjustment.  

There are several ways to diminish the impact these planned stops have on availability. Create process standards, ensure consistency in maintenance routines, seek high-quality parts, follow the manufacturer’s guidelines, and make sure all your equipment is seamlessly compatible. For changeovers, implement a SMED (Single-Minute Exchange of Die) programme, which aims to take as many steps as possible while the equipment is still running, therefore streamlining the whole process and reducing downtime.

Idling/ Minor Stoppages

In this case, production is halted or disrupted briefly. For example, obstructed product flows, lack of raw material or tools, material jams, incorrect settings, blocked sensors, idle operators who are occupied on other machines, dependence on assembly components, or a temporary malfunction. 

All of these stops last only a few minutes (usually less than five) and can be solved by operators themselves. However, they negatively affect cycle time, which is why they are considered a performance loss rather than an availability loss. The problem with these is that they are almost always chronic, and tend to happen time and again. Thanks to new sensor technology and IIoT, you can now begin to track them, improve workflow, and eliminate these “blind spots”.


Like idle time and minor stoppages, losing speed disturbs cycle time and impacts performance. If the actual operating speed is slower than design speed, the machine could be experiencing mechanical problems or the operators might be operating it incorrectly (for example).

Although it’s not as common, sometimes machines also run at faster speeds – which might lead to defective products. Apart from checking machine speed, there are a few measures you can take to avoid this loss. Those include regular equipment cleaning to avoid dirt and dust, replacing worn-out equipment, changing filters and maintaining lubrication according to manufacturer’s guidelines, continuous operator training, and not using substandard materials. Following autonomous maintenance, operators become responsible for these tasks.

Process defects and rework

Process defects refers to defective parts, while rework takes into consideration parts that can still be salvaged and reworked. Defective products are not only one of the 6 losses of OEE, but also one of the 8 wastes of lean manufacturing, and they represent quality loss.

Sometimes, poor operator skill level leads them to mishandle equipment or operate with incorrect settings. Other factors that can be blamed for end-product defects include ineffective maintenance, tooling, lack of raw materials or expired products (i.e., in chemical or pharmaceutical industries). Depending on the root cause, you might need to introduce further operator training or better stock management.

Startup losses (“yield losses”)

While machines are warming up, producing startup waste, or are newly installed and operators still don’t quite know how to operate them, the output decreases. Although it’s more common after changeovers, which we’ve already talked about, they can happen after any equipment startup. 

Startup OEE losses can be avoided through reduced variation. To achieve this, try to define and implement precise equipment settings, even if it’s on a part-by-part basis. You can also run a few materials tests on each piece of equipment to see if it is possible to minimise start-up problems. It’s likely these measures to reduce yield losses will also improve cycle times, which means it will change performance  for the better as well. 

Do you want to know more about TPM and lean maintenance?

Take a look at our articles on Total Productive Maintenance and lean maintenance practices.