PREMIERE MANUFACTURING CASE STUDY, STEP 1 Background: The Present Situation Premiere Manufacturing, Inc., is a Tier 1 automotive supplier producing #4, #6, #8, and #10 coolant hoses for six key customers. Over time, Premiere has been making improvements through kaizen activities. Recently_ the company replaced two screw machines with two dual-spindle CNC machines, which have not proven to be as reliable as expected. One of Premiere's key customers, Cord, Inc., has been consolidating its supply base. Cord has been auditing and analyzing their suppliers' abilities to meet qual ity and delivery demands while also reducing costs. Premiere's long-term agree ment (LTA) with Cord is about to expire. Cord is willing to keep doing business with Premiere but is demanding: A 5 percent cost reduction annually over the next two years. On-time delivery of 98 percent or higher. A lead-time reduction from six weeks to less than two weeks. The plant manager decides to sign the new LTA immediately, because he does not want to run the risk of losing Cord's business. He also has confidence that his people can apply lean tools and methods to achieve the performance goals that Cord demands. Team Formation and Kickoff