Manufacturing organizations undertake a variety of performance improvement initiatives such as Lean Manufacturing, Six-Sigma, TPM and TQM. Organizations leverage KPIs, including Overall Equipment Effectiveness (OEE) to manage and measure such initiatives.
During 2015, Epicor in conjunction with Sage Clarity studied over 100 global manufacturing operations worldwide to benchmark performance and correlate over 20 manufacturing KPIs. Researchers used the Epicor/Informance Enterprise Manufacturing Intelligence Suite and Clarity advisory services to collect data, derive insight and discover correlations to operational success of tactical and strategic actions.
Leveraging the Tier Ranking Methodology (see next section), the analysis reveals the OEE measure for each tier and the sizeable gap between Best-in-Class performers vs. Laggards.
On average, Best-in-Class organizations, exhibit an OEE 2.6x better than
Laggards, due to an OEE of 82.5 vs. 31.2:
(82.5 / 31.2 = 2.6)
From this stack ranking, we then correlate related KPIs to each tier to determine attributes and behaviors of these tiers: which KPIs impact OEE, either positively or adversely.
The analysis begins by establishing OEE as the Best-in-Class determinant: Higher OEE indicates better performance. All organizations are sorted from high to low by OEE, and related KPIs are then correlated to determine KPIs that impact performance.
|Best-in Class OEE||Ranks in the Top 25%|
|Average OEE||Ranks in the Middle 50%|
|Laggard OEE||Ranks in the Bottom 25%|
The study reveals several operational KPIs that are crucial to performance:
|Knowledge Index||Percent of untagged downtime|
|SKU Anomalies||SKUs that exhibit a production rate of +/- 10% of ideal production rate for the SKU.|
|Minor Stop Index||Number of minor stops per hour (minor stop = stop of a duration of 10 minutes or less)|
|Availability||Uptime over Scheduled Time|
Best-in-Class performers exhibit a knowledge index 31x better than Laggard performers
(0.5% vs. 15.7% untagged events)
Manufacturing operations with the best minor stop index, have 6x fewer minor stops per hour than the worst performers.
If OEE>70%: Best-in-Class Performers and Average Performers:
If OEE is between 50 – 70%: Average Performers:
If OEE is between 30 and 50%: Laggard Performers:
This Executive Summary contains a small subset of the insights and actions that organizations can take – both strategic and tactical to improve performance. To Schedule a briefing on the full study, contact Sage Clarity. During this exclusive briefing you will learn insights and strategies gathered during the study. You will also have the opportunity to ask questions about the to adapt these best in class strategies to your business.
For the complete benchmark study, register below.