In the context of manufacturing precision components for industrial applications such as ball bearings, fuel injection systems and hydraulic applications, the machinery itself needs to be even more advanced. This is because current levels of accuracy are now in the range of less that T4 (ISO tolerance class) and hard turning produces the components; hence the tools used must be even harder still. During the project investigations, tests performed on insert clamping and tool design revealed the need for improvements so that optimum quality and cost efficiencies could be maintained. Therefore two particular aspects were examined, namely the manufacturing of optimum cutting edges with grinding machines, and three different types of tool holders. This led to optimising the design of the insert pocket and manufacturing it from high-density materials, and the development of internally cooled tool holders. The third focus was the development of tool holders for machining small bores and testing their performances, which resulted in design guidelines for suitable precision tooling. The prototype tool holders that have internal cooling systems have proven to reduce thermal expansion of the tools during cutting, which results in optimal accuracies being realised. Whereas the new tool holders for small bores enable hard turning to replace the more costly grinding processes and have increased quality thereof. With additional improvements made with regards to cutting edge preparations, this project has undoubtedly witnessed the reality of turning hard metal, which was until recently only a dream. Such realisations will no doubt provide EU precision engineering companies with stronger and more competitive edges for the manufacture of complex geometrical shapes for the present and the foreseeable future.