Each efficiency measure compares Good Output with what the line could have made
These are the equations behind our time-based measurement framework. How we structure lost time explains the framework and shows it as a diagram.
Eleven abbreviations cover the whole framework
This glossary covers every abbreviation on this page and on the Time Hierarchy page, in alphabetical order.
| Abbreviation | Full name | Definition |
|---|---|---|
| BNS | Bottleneck Speed | The maximum sustainable production rate of the constraining process step. |
| LTMW | Lost Time Making Waste | Time spent making defective, rejected or unusable output at actual speed. Waste Output ÷ Run Speed. |
| LTSR | Lost Time Slow Running | Time lost running below BNS while making Good Output. Good Output ÷ Run Speed − Good Output ÷ BNS. |
| OEE | Overall Equipment Effectiveness | PT ÷ PPT, which equals Good Output ÷ (PPT × BNS). It measures execution within Planned Production Time. Textbook A × P × Q is the multiplied form; we use the additive equivalent. |
| OOE | Overall Operations Effectiveness | PT ÷ Shift Time. The management measure, covering every shift loss including Schedule Loss and PDT. Same formula as Machine Efficiency. |
| PDT | Planned Downtime | Scheduled stops: changeovers, planned maintenance and start-of-shift checks. |
| PPT | Planned Production Time | Shift Time − Schedule Loss. The time scheduled for production. |
| PT | Potential Time | Good Output ÷ BNS. The time it would take to make the actual Good Output at full bottleneck speed, with no losses. |
| TEEP | Total Effective Equipment Performance | PT ÷ Calendar Time. The strategic measure for production-constrained sites. |
| UMP | Unit Marginal Profit | Unit revenue less unit material, processing and distribution cost. Labour cost comes off too, but only where the improvement needs new labour. |
| UPDT | Unplanned Downtime | Unplanned stops longer than the classification threshold during Planned Production Time, including overruns of planned stops. |
Each level is the one above minus one kind of loss
Taking each loss away in turn leaves PT: the shortest time it could take to make your actual Good Output at BNS.
- Calendar Time
- minus Non-working Time givesShift Time
- minus Schedule Loss givesPPT (Planned Production Time)
- minus PDT (Planned Downtime) givesOperating Time
- minus UPDT (Unplanned Downtime) givesUp Time
- minus LTSR and LTMW givesPT (Potential Time) = Good Output ÷ BNS
- minus UPDT (Unplanned Downtime) givesUp Time
- minus PDT (Planned Downtime) givesOperating Time
- minus Schedule Loss givesPPT (Planned Production Time)
- minus Non-working Time givesShift Time
The Time Hierarchy diagram shows every level with its definition.
Eight formulas, and the time must balance
PT = Good Output ÷ BNS
Run Speed = Total Output ÷ Up Time
LTSR = Good Output ÷ Run Speed − Good Output ÷ BNS
LTMW = Waste Output ÷ Run Speed
UPDT = Operating Time (actual) − Up Time
Up Time = PT + LTSR + LTMW
Operating Time (actual) = PT + LTSR + LTMW + UPDT
Planning Rate = BNS × Operating Efficiency (planned)
Operating Time (actual) must balance. If it does, the categories neither overlap nor leave gaps.
Each measure widens the time window by one level
| Measure | Formula | Losses in the denominator | Audience | Constraint |
|---|---|---|---|---|
| Operating Efficiency | PT ÷ Operating Time | Losses within Operating Time (UPDT, LTSR, LTMW) | Shop floor | Both |
| OEE | PT ÷ PPT | Adds PDT | Operations | Both |
| OOE (Machine Efficiency) | PT ÷ Shift Time | Adds Schedule Loss | Management | Both |
| TEEP | PT ÷ Calendar Time | Adds Non-working Time | Strategic | Production-constrained |
| Output per Labour Hour | Good Output ÷ Labour Hours | Not applicable | Strategic | Sales-constrained |
Why OEE is Good Output over Potential Output. PT = Good Output ÷ BNS, so:
OEE = PT ÷ PPT = (Good Output ÷ BNS) ÷ PPT = Good Output ÷ (PPT × BNS) = Good Output ÷ Potential Output
Every measure in the table follows this pattern. It shows Good Output as a share of what the line could have made at BNS in that time window.
Choose by who answers for the losses. Operating Efficiency measures execution. OEE adds accountability for PDT, OOE adds Schedule Loss and TEEP adds Non-working Time.
Machine Efficiency and OOE are one formula. Both are PT ÷ Shift Time. Use Machine Efficiency on a sales-constrained site and OOE on a production-constrained site.
The Time Hierarchy page shows how we value Lost Time on production-constrained and sales-constrained sites.
Three checks tell you where to look first
LTSR is high: there are two possible causes, each with a different fix
- True slow running. The line deliberately runs below BNS, for example when an operator slows it for quality reasons.
- Short stops. The line runs at full speed between frequent brief stops. They are too short to log as UPDT, but they pull down the average Run Speed. The Glossary calls these Lost Time Short Stops.
A lineside time study tells them apart. Check whether the line speed setting matches BNS, or whether frequent short stops drag the average down.
UPDT: rank events by how often they happen and how long they last
| Short duration | Long duration | |
|---|---|---|
| High frequency | Highest value, and often missed. Frequent short stops that add up to large losses. | A major chronic issue. Visible, and usually already being tackled. |
| Low frequency | Noise, with little total impact. | Rare, severe events. Tackle them through preventive maintenance. |
The time does not balance: a loss is in the wrong category
Operating Time (actual) must equal PT + LTSR + LTMW + UPDT. If it does not, a loss has gone into the wrong category. Check the Run Speed and BNS inputs first.