OEE measures equipment effectiveness during planned production time, the time when a machine is scheduled to run. A machine scheduled for two shifts per day that achieves 85% OEE during those shifts is performing well by OEE standards, but OEE tells you nothing about the third shift the machine sits idle, the weekend it is not scheduled, or the three weeks per year it is in planned maintenance shutdown.
See our broader guide to OEE vs TEEP.
TEEP (Total Effective Equipment Performance) addresses this gap by measuring performance against all available calendar time, not just scheduled production time. The TEEP formula: TEEP = Loading × Availability × Performance × Quality, where Loading equals the ratio of scheduled production time to total available calendar time.
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Book a demoA machine running two 8-hour shifts per day, 5 days per week achieves a Loading of approximately 47% of total calendar time. If that machine achieves 85% OEE during scheduled time, its TEEP is 0.47 × 0.85 = approximately 40%. TEEP reveals how much of the total capital asset value is being utilized productively, in this case, only 40% of the machine time is generating revenue.
This perspective is directly relevant to capital allocation decisions and capacity planning that OEE alone cannot inform.
OEE is the right metric for production improvement within scheduled production time. If you are trying to reduce unplanned downtime, improve production speed, and reduce quality defects during the shifts when the machine is supposed to be running, OEE is the correct tool.
Maintenance teams, production supervisors, and continuous improvement engineers work with OEE daily. TEEP is the right metric for capital utilization and strategic capacity decisions.
If you are evaluating whether to buy a second machine, whether to add a third shift, or whether to extend operating hours, TEEP shows how much idle capacity already exists before committing to capital expenditure.
A plant with a 40% TEEP has significant capacity headroom before additional capital investment is justified. Finance and operations leadership use TEEP for capacity planning and capex justification.
The two metrics answer different questions and should be used together: OEE tells you how well you are running during scheduled time, TEEP tells you how much of your total asset value is being utilized. A plant improving both OEE and TEEP simultaneously, running scheduled time better while also extending operating hours, achieves the maximum capital efficiency from its installed asset base.
TEEP calculation requires two data inputs beyond standard OEE: the total available calendar time for each asset and the actual scheduled production time. Most OEE software platforms track scheduled production time (from shift schedules or production plans) and compare it to actual production.
Extending this to TEEP requires the platform to also track unscheduled time, time when the machine was available but not scheduled for production. TEEP is typically tracked at the monthly or quarterly level rather than daily, because short-term TEEP fluctuations reflect scheduling decisions rather than equipment performance.
A machine taken offline for a week of planned maintenance shows a TEEP drop for that period that is fully expected and managed.
Monthly TEEP trends are more meaningful for capital utilization analysis. For manufacturers evaluating capacity expansion, TEEP data from the previous 12 months provides the evidence base for the decision: if TEEP is above 60 to 65%, the existing asset base is well-utilized and capacity expansion may be warranted.
If TEEP is below 40%, significant scheduling and OEE improvement opportunity exists before capital investment is justified. OEE software that tracks both OEE and TEEP in the same platform enables this analysis without external data manipulation.
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