I like baseball, and I like baseball statistics – especially sabermetrics. These advanced statistics, referring to the acronym for the Society for American Baseball Research, are transforming how those in the game and those observing the national pastime gauge performance. For example, wins above replacement player (WARP) is, according to Baseball Prospectus, “the number of wins this player contributed, above what a replacement-level hitter, fielder, and pitcher would have done, with adjustments only for within the season.” WARP quickly reveals the value of a player to an organization.
Imagine having a go-to metric for manufacturing that similarly and quickly gauges the value of a plant to an organization. To that end, MPI computed overall plant efficiency (OPE) for U.S. manufacturing facilities, using 2010 MPI Manufacturing Study median and weighted data and U.S. labor data. OPE is a multiple of the following three factors:
- Overall equipment effectiveness (OEE): multiple of three subfactors for an equipment effectiveness metric.
- Labor operating efficiency (LOE): multiple of three subfactors for a labor effectiveness metric.
- Capacity usage: measure of production volume as a percentage of designed capacity.
OPE for U.S. plants was approximately 18% in 2010 (see below). How do your plants — or functions and departments within your plants — stack up?
|
Overall equipment
effectiveness (OEE)
|
Machine availability %
Quality yield % Run rate as % of optimal run rate |
80.0%
|
|
Labor operating
efficiency (LOE)
|
Empowerment %
Annual labor retention % Nonabsenteeism % |
38.2%
|
|
Capacity usage
|
Production volume
as % of designed capacity |
60.0%
|
|
Overall plant efficiency
(OPE) |
OEE X LOE X Capacity usage
|
18.3%
|
Source: MPI 2010 Manufacturing Study and U.S. Bureau of Labor Statistics.
By George Taninecz, VP of Research, The MPI Group
Comments