Bas Timmermans from the Netherlands asked a question about OEE and one piece flow cells:
How would you best plan such a cell? Would you make an hour-by-hour chart based on the cycle time and plan only the hours needed, leaving some contingency time at the end of a shift for catching up the losses during that shift if any (representing OEE)? Or would you calculate the OEE into the takt time? From what I’ve read about Toyota I get the idea that they use overtime to compensate losses. Is that correct?
Bas has many if not all of the bits of the answer. Let’s try to put them together. In some cases we’ve written about some of these topics in the past, highlighted as links below. First, OEE is not typically measured at the cell level but by the critical machine or machines in the cell. This would be determined by which machines have limited capacity, poor quality yields or have the potential to limit the output of the cell due to any of the six big loss factors. For review, OEE is overall equipment effectiveness. It is calculated as:
OEE = availability (A) x performance (P) x quality (Q)
OEE takes into account the six big losses, which are 1) Unplanned breakdowns, 2) machine set up and changeovers, 3) idling and minor stops, 4) reduced speed, 5) defects and scrap, and 6) start up and yield losses. These correspond to the A, P and Q categories respectively. For more information please see this article. Unless there is a real need to measure OEE as such at the cell, I would recommending one or more of the six big losses specifically instead.
When planning for one piece flow cells these losses need to be taken into account just as when planning any system. Takt time is the average rate of customer demand and this number can be used to calculate everything from crew size to standard work in process quantity to lead-time through the cell. The theoretical takt time is calculated purely based on the net available time and customer demand for a particular period:
takt time = net available time per period / customer demand per period
However in practice there is something called actual takt time which is used to operate the production line or one piece flow cell. The calculation for actual takt time takes into account various factors including losses. There are other approaches to planning capacity for one piece flow cells when there are known losses, such as this example of taking changeover time into account for takt time calculation.
Once the takt time has been set and the line is running, hour by hour charts or in the case of high-speed, high volume automation real-time electronic performance displays are used to track the planned versus actual production output and reasons for any losses. Making the losses visible is and lining up organizational resources to rapidly address these problems is a key lean management behavior. Even Toyota does not aim for 100% but rather expects to run somewhere between 95% and 99%, depending on the line and the product. A 100% rate indicates that there is too much inventory, time or other slack in the system, hiding waste.
Many lean companies realize that running a factory 24 hours 7 days per week is an apparent efficiency hiding other system-wide wastes. This focus on high asset utilization can result in a loss of flexibility, remove preventive maintenance time and weaken the mindset to “finish today’s work today.” When there is barely enough time between shifts to communicate and hand over the work people begin to lose their sense of responsibility for fulfilling customer orders within their shift. The ability to catch up and meet production requirements during each day is an essential planning discipline and the 2-hour gap between shifts is one example of how on-time delivery in enabled when running a lean operation.
Hopefully that answers your question Bas. If not please post a follow up. As always, others are welcome to chip in.