The Six Big Losses in Manufacturing (and How to Reduce Them)

The Six Big Losses Framework

In Lean Manufacturing, tracking OEE is only the first step. To actually improve OEE, you must understand the root causes of your losses. The Six Big Losses framework categorizes the most common causes of manufacturing waste, mapping them directly to the three OEE pillars: Availability, Performance, and Quality.

1. Availability Losses (Downtime)

Availability losses occur when the machine is scheduled to run, but is stopped for a significant period. These are divided into:

Loss 1: Equipment Failures / Breakdowns

This occurs when a machine breaks down or stops operating due to a mechanical, electrical, or structural fault.

• Examples: Motor burnouts, broken conveyor belts, software crashes, hydraulic leaks.
• How to Reduce: Implement a robust Preventive Maintenance (PM) schedule and utilize predictive sensors to catch wear before failure.

Loss 2: Setups and Adjustments

This accounts for the downtime required to prepare a machine for a new job or to make adjustments after a shift change.

• Examples: Tooling changeovers, material loading, machine cleanings, temperature settings calibration.
• How to Reduce: Implement SMED (Single-Minute Exchange of Die) methodologies to streamline and standardize changeovers.

2. Performance Losses (Speed)

Performance losses occur when the machine runs slower than its maximum rated cycle time. These are divided into:

Loss 3: Idling and Minor Stops

This occurs when the machine stops briefly, typically for less than a minute, and doesn't require maintenance personnel to fix.

• Examples: Component jams, sensor blockages, operator waiting on material feeding, temporary tool cleanings.
• How to Reduce: Audit standard operating procedures, clean sensors regularly, and streamline material pathways to keep parts flowing.

Loss 4: Reduced Speed

This occurs when equipment is run below its design capacity or target speed.

• Examples: Worn gears necessitating slower speeds, operator manually slowing a machine to prevent quality defects, lubrication issues.
• How to Reduce: Ensure machines are fully maintained to run safely at target speeds. Check if cycle times are set realistically.

3. Quality Losses (Defects)

Quality losses occur when parts fail to meet specifications, wasting material and production time. These are divided into:

Loss 5: Process Defects

These are rejected parts produced during stable, standard production runs.

• Examples: Incorrect dimensions, assembly errors, aesthetic blemishes, structural cracks.
• How to Reduce: Implement Six Sigma or Statistical Process Control (SPC) to monitor quality parameters dynamically.

Loss 6: Reduced Yield (Startup Rejects)

These are defective parts produced during the startup phase after a setup, adjustment, or shift change.

• Examples: Parts made while calibration is warming up, scrap created testing adjustments.
• How to Reduce: Standardize startup procedures and implement smart sensors to pre-align parameters prior to running materials.

Conclusion

By mapping your factory's production data to these Six Big Losses, you move from knowing what your OEE is to knowing why it is at that level. Focus on one loss at a time—usually starting with the biggest time loss (Equipment Breakdowns or Setup Adjustments)—to unlock hidden capacity on your factory floor.