Overall Equipment Effectiveness (OEE) is the gold standard for measuring manufacturing productivity. It is calculated as the product of three factors: Availability (actual run time vs. planned production time), Performance (actual throughput vs. theoretical maximum), and Quality (good parts vs. total parts produced).
An OEE score of 100% means you are manufacturing only good parts, as fast as possible, with no downtime. World-class OEE is generally considered to be 85% or above. Most manufacturers operate between 60-75%, meaning there is significant room for improvement.
The power of OEE is not in the single number, but in breaking it down. Low availability points to downtime problems (breakdowns, changeovers). Low performance indicates speed losses (slow cycles, minor stops). Low quality reveals scrap and rework issues. Each factor requires a different improvement strategy.