The Equipment Effective Percentage Can Be Useful for Equipment Evaluation

Computing the actual percentage of time that a piece of equipment is in use compared to the total time that the equipment piece is available for use can help to evaluate the equipment piece's effectiveness.  Evaluating expensive equipment effectiveness can be useful for making better use of the equipment, in making purchase and sale decisions, and probably in other decisions related to the equipment.

The purpose of this blog is to provide an example of computing an equipment effective percentage.  Suppose a company has 2 concrete drills with different characteristics.  Drill #1 is less powerful but requires less maintenance time than Drill #2.  Drill #1 requires 4 hours of maintenance after 19 days of use, whereas Drill #2 requires 24 hours after 19 days of use.  However, Drill #2 is easier to operate, demanding less time the operator needs to take a break from using the drill.  The operator only needs a 5-minute break per hour for Drill #2.  For Drill #1, the operator needs a 15-minute break per hour.  The company has sufficient need for both drills to use them eight hours each day of the work year (240 work days; 20 days a month for 12 months).

The equipment effective percentage is a ratio of the actual use of the equipment divided by the available use (expressed as a percentage).  The available time for each drill is 1,920 hours per year (240 work days times 8 hours per day).  The actual use time for Drill #1 (from the facts above) is 1,392 hours per year [1,920 hours less 48 hours maintenance (4 hours per month times 12 months) and less 480 hours operator’s rest time (15 minutes per hour for 1,920 hours)].   The actual use time for Drill #2 (from the facts above) is 1,472 hours [1,920 less 288 hours maintenance (24 hours per month times 12 months) and less 160 hours operator’s rest time (5 minutes per hour for 1,920 hours)].

Knowing the actual use times for Drills #1 and #2, the equipment effective percentages (EEP) can be computed.  For Drill #1, the EEP is 72.5% (1,392 hours divided by 1,920 hours) and for Drill #2 the EEP is 76.7% (1,472 hours divided by 1,920 hours).  So, Drill #2 is in actual use more than Drill #1.  This may be surprising since Drill #2 has a much higher down time due to maintenance.  However, its much less down time due to operator’s rest time more than makes up for the higher maintenance time.

The equipment effective percentage is a way of evaluating equipment that can provide insights about the equipment use that may not be expected.  And, therefore, better decisions might be made.  The equipment effective percentage analysis can be applied not only to equipment but other assets that are in use.