Most factories do not lose money because machines are slow.
They lose money because machines do not run enough.
TEEP helps you see the time and capacity that OEE never shows.
What Is TEEP?
TEEP (Total Effective Equipment Performance) shows how effectively a machine is used across all available time — 24 hours a day, 7 days a week.
While OEE looks at performance only during planned production time, TEEP goes one level higher and answers a bigger question:
“How much of the machine’s total possible capacity are we actually using?”
TEEP helps factories uncover:
- Idle nights and weekends
- Unused shifts
- Hidden capacity
- Lost revenue caused by machines not running
This makes TEEP a business and capacity metric, not just an operational one.
TEEP Calculation Formula
TEEP is calculated using this simple formula:
TEEP = Utilization × OEE
Where
Utilization Formula
Utilization = Planned Production Time ÷ Total Available Time
Total Available Time → 24×7 calendar time
Planned Production Time → Scheduled shifts
TEEP combines:
- How often the machine runs (Utilization)
- How well it runs (OEE)
TEEP Calculation Example
Let’s take a simple example.
- Machine available: 24 hours per day
- Planned production time: 16 hours per day
OEE during production: 75%
Step 1: Calculate Utilization
16 ÷ 24 = 66.6%
Step 2: Calculate TEEP
66.6% × 75% = 50%
Even though OEE looks good, the machine is delivering only 50% of its true potential output.
This gap is invisible if you track only OEE.
Action point
If I take a loan from the bank to buy a machine, the bankers expect to be paid the principal + interest on the loan every month. They do not care how many hours I run the machine. If I run the machine only 12 hours a day, my revenue is half what it could have been if I ran it 24 hours a day. If orders are not a constraint, it makes sense for me to run my machine longer hours – run it 24 hours, run it across breaks, etc. TEEP makes more sense than OEE as a measure of my ability to repay the bank loan.
It is therefore important to understand the TEEP definition, TEEP calculation, and OEE vs. TEEP difference.
What Is OEE?
OEE (Overall Equipment Effectiveness) measures how well a machine performs during scheduled production time.
In simple words:
OEE shows how much of your planned production time was truly productive.
It combines three key factors into one number:
- Availability – Did the machine run when it was supposed to?
- Performance – Did it run at the right speed?
- Quality – Did it produce good parts?
OEE Formula
OEE = Availability × Performance × Quality
OEE is mainly used to:
- Reduce downtime
- Improve cycle time
- Improve quality
Compare performance across shifts and machines
Try our free
OEE calculator
See exactly how well your machines are performing. Get instant results to find hidden opportunities to boost uptime, quality, and speed.
Why OEE Alone Does Not Show the Full Picture
OEE is a strong metric — but it has a limitation.
It only measures scheduled production time.
OEE does not show:
- Time when machines were not scheduled
- Idle nights and weekends
- Lost capacity due to fewer shifts
- Business-level capacity gaps
This is why many factories see:
- High OEE scores
- But still struggle to meet demand
- Or invest in new machines too early
OEE tells you how well machines run.
It does not tell you how much more they could run.
That’s the gap TEEP fills.
OEE vs TEEP
| Factor | OEE | TEEP |
|---|---|---|
| Measures scheduled production time | Yes | No |
| Includes unscheduled time | No | Yes |
| Focuses on shop-floor efficiency | Yes | No |
| Focuses on capacity & utilization | No | Yes |
| Helps improve shift performance | Yes | No |
| Helps plan expansion & CAPEX | No | Yes |
Simple way to remember:
- OEE = operational view
- TEEP = business and capacity view
How TEEP and OEE Work Best Together
High-performing factories don’t choose between OEE and TEEP.
They use both together.
- OEE helps improve performance inside the shift
- TEEP helps improve utilization outside the shift
When used together, teams can:
- Increase output without overtime
- Identify unused production windows
- Delay new machine purchases
- Align shop-floor data with business decisions
If OEE tells you how well machines run,
then TEEP tells you how much they could run.
Most factories lose money not because machines are slow —
but because they don’t run enough.
TEEP is how you uncover that unused time, and OEE is how you fix performance during productive time.
Together, they show the full picture of productivity and capacity.
