Journal Name:
- Journal of Industrial Engineering and Management
Key Words:
Abstract (2. Language):
Purpose: The paper is primarily done on the purpose of introducing new concept in defining the
Overall Equipment Effectiveness (OEE) with the consideration of both machine utilization
and customer demand requested. Previous literature on limitation and difficulty of OEE
implementation have investigated in order to track out the potential opportunities to be
improved, since the OEE has been widely accepted by most of the industries regardless their
manufacturing environment.
Design/methodology/approach: The design is rely primarily on literature review and computerized
data. In details, the novel definition and method of processing the computerized data are all
interpreted based on similar studies performed by others and supported by related journals in
proving the validation of the output. Over the things, the computerized data are the product
amount and total time elapsed on each production which is automatically recorded by the
system at the manufacturing site.
Findings: The findings of this paper placed into two dimensions. The first is exposure and
emphasis of limitation exists in current implementation of OEE, which showing that high
utilization of the machine is encouraged regardless of the customer demand and is having
conflict with the inventory handling cost. This is certainly obvious with overproduction issues
especially during low customer demand period. The second is, the limitation in general implementation of OEE is the difficulty in obtaining the ideal cycle time, especially those
equipments with constant process time. The section of this paper afterward comes out with the
proposed solution in fixing this problem through the definition of performance ratio and then
usage this definition in measuring the machine utilization from time to time. Before this, the
time available for the production is calculated incorporating the availability of OEE, which is
then used to get the Takt time.
Research limitations/implications: Future research should be conducted to examine the possibility
and to verify the definition of such performance ratio including Takt time on those processes
of which its operating time is possibly to be reduced, especially those are not constant and
fixed. This piece of research is temporarily done on the process where its operating time is
constant from time to time and there is no ideal cycle time possible.
Practical implications: The awareness of the overproduction should be emphasized and raised in
the intention of pursuing higher OEE value. As the definition proposed, the process with
constant cycle time could even be defined in different performance ratio from time to time
regarding the customer demands and corresponding production rate. These two variables can
be adjusted and balanced to increase the OEE value through optimization of average cycle
time. Over this, optimization of average cycle time on equipment with constant operating time
can be achieved through the optimization of loading number per each processing.
Originality/value: The novelty of the paper comes from the inclusion of customer demand in
obtaining OEE value of any particular equipment. Besides that, the equipment without ideal
cycle time, which means those processes carried out in constant cycle time are possibly to be
evaluated with performance ratio. As a consequence, the machine utilization and capacity used
could be quantified and visualized using the performance ratio data of the OEE proposed.
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