Have you ever been measured against an unrealistic goal? Most OEE goals in manufacturing are demotivating to front line employees.
OEE (Overall Equipment Effectiveness) is how many factories determine their equipment effectiveness. The OEE calculation starts with calendar time and then subtracts away schedule losses, availability losses, performance losses, and then quality losses.
Organizational strategy doesn’t match OEE goals
When an operation sets their OEE goal, they are making assumptions about organizational strategy such as available staffing on line and the production schedule. These assumptions are often not communicated to the team, only the final metric of a target OEE is communicated. Most organizations practice “set it and forget” when it comes to OEE targets. Everyone knows that the OEE target is the same every day, every week, and every month.
The business cycle, production schedule, and staffing levels vary over time in a manufacturing organization. If your team is understaffed this week due to team vacation, your OEE target is still the same, but your chances of meeting your OEE target are significantly lower. If a hot customer order is due today, the entire production schedule is changed to perform a challenging changeover, the OEE target for today remains the same, but the team has zero chance of hitting that target.
These examples may seem like one-off examples of misalignment of organizational strategy and OEE goals, but they happen all the time. When you set a goal for an organization, but the team legitimately can’t achieve the goals for a significant portion of the time, you are setting the team up for “failing.” In team motivation, meeting a goal builds momentum. Continuous missing a goal creates a negative momentum, and then your OEE goal is branded as “unachievable” in the minds of the team. Once your team believes that there is nothing they can do to achieve the OEE goal, their motivation has evaporated.
- Relay the operational strategy assumptions for your OEE calculation to the front line workers
- Adjust the OEE target when the operation is incapable of meeting the target
- Create a “journey” to OEE target with a glidepath that allows the team to build momentum in achieving the goals
Leadership delays investment to eliminate OEE losses
The beautiful thing about the OEE formula is that it will tell you all the potential losses that are plaguing your operation. When the business leadership is reviewing the results from the past year, you can zone in on what is actionable and where you can make investments to improve your OEE.
When a loss is identified through OEE measurement of production equipment, the team has a sufficient way to prioritize investment and spending for improvements. The front line factory workers are often not involved in the investment decisions, and even the final outcomes for projects are not shared with the front line workers. This is a huge gap in manufacturing teams because front line workers can help interpret OEE losses and generate simple low cost ideas for improvement of top losses.
Day after day the team is struggling with the same losses, but the management team is failing to fund appropriate investment on the factory floor to eliminate the top losses. After dealing with the same issues day after day, the team will get demotivated because their ability to achieve the OEE goal is significantly limited with the ongoing top losses.
- Include front line factory workers in conversations about what investments should be made to improve OEE
- Allow front line workers to participate on project teams to improve OEE
- Communicate what is not going to be a project and why
Leadership communication is like a bad game of telephone
In order for any OEE software to function properly, the leadership communication must be standardized. For example, when a team member selects a reason for a stop or loss, everyone in the leadership hierarchy should understand what that loss reason means and the critical problem that the loss reason has identified.
The communication chain can work like a game of telephone, where the front line worker who intervened during that stop on the equipment tells his team lead what happened, then his team lead tells her supervisor about the issue. Then the supervisor communicates the issue to the next shift’s supervisor. When the next shift’s supervisor attends the daily meeting, he or she is 4 steps removed from the original problem. When the problem statement is unclear or the standard of communication hasn’t been documented, the problem statement can look very different after 4 people in the telephone chain.
This is just one example of a loss that occurred on a non-dayshift without leadership resources engagement in the problem. In a typical organization, there are hundreds of these examples within one month. The leadership team, from the team leads to the directors, must have a standard of communication and language or else the members of the leadership team won’t be able to understand each other and relay the top issues.
- Create a standard way to communicate an issue: Expect the team to fill out a problem statement when a loss is identified
- Verify that the loss reasons entered on the OEE software has a matching problem statement
- Invite front line workers to the daily meeting to discuss a top problem statement