Downtime, rework, waste, and underutilized labour silently drain productivity, erode margins, and delay throughput. Optimizing Manufacturing Line Operating Efficiency (MLOE), which is how close your line operates to full potential, is not just a technical concern… It’s a strategic operation for profitability, competitiveness, and long-term resilience.

A recent study found that 66% of manufacturers reported efficiency gains after digital transformation, and 59% saw a Return on investment within the first year. These results show that modernizing operations isn’t just beneficial – it’s often immediately profitable.

In this article

What Is Manufacturing Line Operating Efficiency — and how is it measured?

Manufacturing Line Operating Efficiency (MLOE) is a performance metric that measures how effectively a production line operates within a given time frame. It takes into consideration availability, performance, and quality losses and reflects real-world numbers against their full potential.

You’ll find manufacturing line operations across several industries, including automotive, electronics, food and beverage, pharmaceuticals or life sciences, and textiles, to name a few.  Regardless of the industry, line operating efficiency is key to Overall Equipment Effectiveness (OEE), which is the gold standard for measuring manufacturing productivity.

Companies often ask, ‘Is my output productive?’ Analyzing manufacturing time percentages helps determine whether throughput is meeting expectations. Even a 1% increase in OEE, from faster cycle time, reduced changeovers, or higher first-pass yield, can drive meaningful throughput gains with no added labour or capital!

When Statistics Canada noted that Canada’s labour productivity declined 1.8% in 2023 for the third straight drop, Maple Leaf Foods saw 30% higher output and 25% lower operational cost after smart factory investments. By investing in a manufacturing line operating efficiency, their long-term digital transformation — $65 million dollar investment in IoT sensors, automated production lines, and real‑time monitoring beginning in 2019 — delivered.

An efficient manufacturing line minimizes waste, energy use, and labour costs while maximizing output and quality, resulting in fewer defects and better customer experiences.

What are the barriers to Manufacturing Line Operating Efficiency?

“We spend more time fixing machines than making product,” is common feedback heard from some facilities and plants. Aging machinery is a leading cause of efficiency loss with equipment downtime. Equipment downtime disrupts operations, delays deliveries, and triggers supply chain issues, ultimately hurting customer satisfaction and profitability.

There’s also the human element — we’re not perfect; we make mistakes. When those mistakes happen in manual processes, it can lead to inefficiencies. It’s not just human error — if a machine is too complex or employees haven’t been properly trained, then that can also lead to downtime. A lack of integrated data systems can hinder decision-making by managers. Without real-time data that could potentially optimize line operations, businesses are being left behind when held to the standards of their competitors.

How to increase operating efficiency

Improving line efficiency doesn’t always require significant financial investment. Companies can address common challenges by rethinking their approach, starting with physical changes and progressing to advanced technologies:

• Optimize floor layout:  Even a change from 40% to 50% OEE can result in 25% more output without new machinery, roughly equivalent to adding a production line at much lower cost!
• Maintain continuous improvement: Implement manual inspection, Just-in-Time (JIT) production, or predictive maintenance tools like Real-Time monitoring
• Integrate technology: Invest in Industry 4.0 to automate and monitor processes and analyze data to optimize workflows. Smart factory initiatives can boost labour productivity by up to 30% and cut energy use by 10–20%, making them a critical investment for companies aiming to stay competitive.

For CFOs and procurement leaders, improving MLOE isn’t just about technical optimization — it’s about capital efficiency and risk management. A line running at 60% efficiency leaves 40% of potential output untapped, and luckily, often recoverable. Optimizing MLOE with real-time monitoring or predictive maintenance can unlock multi-million-dollar gains annually, without new equipment.

What’s more, increasing line efficiency improves asset utilization while reducing the cost per unit produced. This makes operating efficiency a critical component of both short-term profitability and long-term capital strategy.

From data to dollars: A roadmap for improving Line Operating Efficiency

If you’re looking to improve your manufacturing line operating efficiency, consider these points:

• Assess current OEE: What is your baseline, and what is your goal?
• Identify the struggles: Downtime? Rejects? Wait time?
• Select one area for high-impact change – is it floor layout? Implementing new technologies?
• Work with low-hanging tech: consider monitoring lines with IoT sensors, adding predictive maintenance (PdM) technology, or upgrading your automation with robots.
• Train your people: Your process improvement needs people you can trust, who take initiative, and are ready to become skilled experts in their fields.

The future belongs to manufacturers that turn operational data into actionable insight. With input costs rising and demand becoming harder to forecast, efficiency isn’t just a productivity metric. Don’t wait for the competition to pass you by. With rising operational costs and shrinking margins, the future belongs to manufacturers who invest in lean, data-driven, and tech-enabled efficiency.