Installed efficiency

Are these metrics the most appropriate measurements? MRP systems plan production, efficiency and log output. Both yield data on what was produced and when but are of limited help in controlling costs and maximizing output from a fixed set of resources.

This is where efficiency, utilization and productivity measures come in. Efficiency is a ratio of input to output. Some processes are inherently inefficient though.

Machining an aerospace bracket involves cutting away most of the metal, in effect, wasting it. Is that efficient? Perhaps 3D printing would be more efficient, even though it might take longer and require more processing steps.

How about utilization? This is a measure of resource activation. But is low utilization necessarily negative? Press utilization is low even though the cell is running efficiently. Productivity is determined by how much is produced per unit of input. The rationale is that fewer hours per vehicle means lower costs. That might have been true before widespread automation, but the measure has less value today. Over the last 25 years or so many manufacturers, in search of a better way of measuring factory performance, have adopted Overall Equipment Effectiveness OEE OEE is a percentage, arrived at by multiplying availability with performance rate and quality rate.

OEE highlights opportunities for improvement. It helps managers identify what to focus on and what to overlook. If a machine or line takes a long time to set up that may be reflected in all three contributing factors. Likewise, micro-stoppages reduce the performance rate and poor reliability will appear in availability. OEE has two significant deficiencies. Addressing productivity first, the availability component can be boosted by adding labor.

In this scenario, at the end of the second hour, the turbine would have generated 3 megawatt-hours of energy i. If the wind was not blowing strongly enough for the turbine to operate at its maximum capacity, and the same turbine was only producing 1 megawatt of power for 2 hours, the total energy generation would be 2 megawatt-hours i.

This simple thought exercise demonstrates how calculations of generation take into account the fact that not all generation sources are operating at their maximum capacity at all times, such as when the sun isn't shining or when the wind isn't blowing. Learn more about recent advancements in wind energy and solar energy. Take wind or solar, for example. What is Capacity? What is Generation? Where Can I Learn More?