maji tools library
Efficiency Formulas quick reference
The equations behind majaco's time-based measurement framework. For the full interactive methodology, see the Time Hierarchy page.
Glossary
This is the single source of truth for all acronyms used across the Time Hierarchy page and this reference. All terms are listed alphabetically.
| Abbreviation | Full Name | Definition |
|---|---|---|
| BNS | Bottleneck Speed | Maximum demonstrated sustainable speed of the constraining process step |
| LTMW | Lost Time Making Waste | Time equivalent of producing defective output. Formula: Waste Output / Run Speed |
| LTSR | Lost Time Slow Running | Time equivalent of running below BNS. Formula: Good Output / Run Speed − Good Output / BNS |
| OEE | Overall Equipment Effectiveness | PT / PPT. Measures execution within planned production time. Equivalent to Good Output / (PPT × BNS). Note: industry-standard A × P × Q is the multiplicative form; majaco uses the additive equivalent |
| OOE | Overall Operations Effectiveness | PT / Shift Time. Management metric covering all shift losses including schedule loss and PDT. Same formula as “Machine Efficiency” - name signals production context |
| PDT | Planned Downtime | Scheduled stops: changeovers, planned maintenance, start-of-shift checks |
| PPT | Planned Production Time | Shift Time − Schedule Loss. Time explicitly scheduled for production |
| PT | Potential Time | Good Output / BNS. Theoretical minimum time to produce actual Good Output at maximum bottleneck speed |
| TEEP | Total Effective Equipment Performance | PT / Calendar Time. Strategic metric for production-constrained environments |
| UMP | Unit Marginal Profit | Revenue minus truly variable costs per unit |
| UPDT | Unplanned Downtime | Breakdowns, stoppages, material/labour waiting |
Time Hierarchy
Every level is formed by subtracting a loss category from the level above. The result is PT - the theoretical minimum time to produce your actual Good Output at BNS.
For the full interactive hierarchy with expandable levels, see the Time Hierarchy page.
Core formulas
Efficiency metrics
| Metric | Formula | Denominator scope | Audience | Constraint context |
|---|---|---|---|---|
| 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 | N/A | Strategic | Sales-constrained |
Equivalence proof
Since PT = Good Output / BNS:
Every metric in the table follows this pattern: Good Output as a proportion of what could have been produced in the denominator time window at BNS.
Widening denominator logic: each metric widens the denominator one level up the hierarchy. Operating Efficiency measures execution; OEE adds PDT accountability; OOE adds schedule loss; TEEP adds non-working time. Choose based on who is accountable for the losses in scope.
Machine Efficiency vs OOE: Machine Efficiency and OOE are the same formula (PT / Shift Time) - the name changes with strategic intent. Use “Machine Efficiency” in a sales-constrained context; “OOE” in a production-constrained context.
For financial valuation of Lost Time (production-constrained vs sales-constrained), see the Time Hierarchy page.
Diagnostic quick reference
LTSR elevated?
Two possible causes - the fix is different for each:
- True slow running - the line deliberately operates below BNS (e.g. operator reduces speed for quality reasons).
- Micro-stops - the line runs at full speed between frequent brief stops that are too short to log as UPDT but reduce the average Run Speed.
Diagnose with a lineside time study: observe whether the line speed setting matches BNS, or whether frequent micro-stops are dragging the average down.
UPDT prioritisation
Use a frequency and duration matrix to prioritise UPDT events:
| Low Duration | High Duration | |
|---|---|---|
| High Frequency | Highest value - often missed; frequent short stops that aggregate to large losses | Major chronic issue - visible and usually already being addressed |
| Low Frequency | Noise - low total impact | Rare catastrophic events - address through preventive maintenance |
MECE verification
Operating Time (Actual) must equal PT + LTSR + LTMW + UPDT. If it does not balance, a loss category has been mis-allocated. Check Run Speed and BNS inputs first.
Talk to majaco
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majaco can implement this framework in your facility - from data collection design through to live dashboards and financial valuation.