Why make a Financial Analysis on OEE?
Each shift, a machine will have a different performance with different results. This will be reflected in the OEE and it’s parameters. However each constellation of a certain OEE will have a different financial impact. Losing 2% on downtime or losing 2% on quality may show a huge difference in the financial result. The OEE number as such says little to nothing about the financial result. And even two shifts with the same OEE number could have en enormous difference when looking at the burned and generated money. This module give clear insights.
How to make a Financial Analysis?
1. Enter financial master-data
OEE Coach will use the financial master-data given in the master-data tables. Sometimes you will find this difficult to determine. Give it a best shot that is as plausible as possible.
Try to find the ‘as raw as possible’ numbers; this means do not use numbers that already contain al kind of additions, subtractions etc.
- Teams: Average cost per team member
- Shifts: Cost factor rate
- Machine: Financing/Insurance/Housing/Facilities/Overhead
- MAP: for each product; Value, Material cost, don’t forget the extra handling cost of scrap and rework!
2. Open financial Module
3. Select the machine and data-range to focus on
Remove the manual/filter option: we only use it with filter
The financial analysis:
- …is always based on whole days (24hrs); therefore no shifts or teams can be filtered upon
- …is made on a machine; no lines, cells or factories can be filtered upon.
4. Press [Calculate] to calculate the financial impact of the selection
OEE Coach now uses the financial base-data from the master-data and the actual shift-data to calculate minute by minute, 24/7, how much money was ‘burned’ and how much money was generated. The result is being displayed below the selected filter in the left pane.
These numbers can not be edited since they are the ‘as-is’ situation; your ‘baseline’ to start the what-if analysis.
5. Press [print] to print the financial analysis
How to make a Financial What-If Simulation?
What is a financial simulation?
Now that we have a detailed insight in the financial result of the machine during the selected period we can do a What-If analysis, in order to detect the financial impact of any change to the current situation.
e.g.: What would be the financial effect when adding an extra operator (higher cost) which leads to x% less downtime?
How to do it?
When you generate the financial analysis, in the middle pane the same data is ‘mirrored’
You can now manipulate this ‘mirror’, after which the system wil recalculate the data with these new data.
1. Enter What If data
In the middel pane, you may now simulate what would happen if… e.g
- What happens when we add one operator and now have 60 min less downtime and 10% more speed?
- What is the effect of having a lower overhead?
- What if we reduce scrap by 1%?
- What if we add an expensive night-shift?
The right pane shows the comparison between the current situation, the what-if situation and the result for the same period.
2. make action-plan
After simulating several options, make an actionplan how to achieve the desired situation.