P.E. - Production Effectiveness - is a KPI that mimics OEE calculations exclusively for planned work time!

Both OEE and P.E. take into account losses due to 3 parameters:

The formula for OEE and P.E. is the same: Availability X Performance X Quality.

Availability accounts for the ONLY DIFFERENCE between P.E. and OEE. By adjusting the Availability Index to take into account only planned work time - P.E. acts as an alternative OEE measure that ignores scheduled losses.

Whereas downtime is production time lost to chance, bad luck, or poor planning - the idle time is production time lost by design. So it is useful to calculate the availability index both ways- both including and excluding idle time.

If your manufacturing plant has planned off-times, OEE can be abysmally low. Not only is this demoralizing, but it can also skew data interpretation.

OEE can be difficult to interpret because it measures asset utilization against a hypothetical round-the-clock standard. If your plant has planned off-times, OEE can be abysmally low, which is not only demoralizing but can also skew data interpretation.

Let's take a simple example: a single machine with one working shift per day. Even if this line ran at full capacity for its entire planned operating time of 8 hours over a period of 24 hours - it would achieve an OEE of 0.333. That is because it is only working 8 hours of the 24 hours available in a day. If that same line were down for one hour out of its 8-hour shift - it would still achieve an OEE of 0.292.

In such a case, OEE does not clearly communicate the drop in availability in the most convenient manner. What is needed is a measure that clearly reflects a drop of 12.5% in machine availability. Consider that if the standard is set at 8 hours - then a loss of one hour out of 8 will now show an effectiveness index of 0.875 instead of 1.000.

True, 0.292 is 87.5% of 0.333, but P.E. makes it easier to see this drop. Such differences in data representation are hardly inconsequential. Once OEE-related KPIs are used to indicate the performance of real manufacturing processes, for their truly intricate complexities, it becomes increasingly difficult to make sense of the data.

This is why OEE should be set against a corollary KPI that excludes planned inactivity.

OEE assumes availability 24/7, 365 days/year. It does not take into account any scheduled inactivity. OEE ignores holidays and weekends. It ignores personnel constraints. It ignores a myriad of issues that lead to planned idle time.

P.E. only considers planned work time. P.E. asks how much time did a line actually work of the time it was scheduled to work? Highly intuitive, P.E. measures equipment availability and operational availability as a ratio of planned runtime. This means that Matic's users control which events count against the P.E. effectiveness index and this is why it is a highly useful and beneficial cross-reference against OEE.

OEE and P.E. are both benchmarks for maximal production capacity, and they both function as excellent KPIs for measuring improvements in profits, production, man-hour productivity, and asset utilization. They both show deviations from the ideal: uninterrupted production, that is progressing at an ideal speed according to engineering standards, and without waste or defective products.
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