Case | HBS Case Collection | September 2008 (Revised August 2009)

Columbus Tubing: Steel is Real

by Daniel C. Snow, Gary P. Pisano, Elena Corsi and Gudrun Urfalino Kristinsdottir

Abstract

Columbus Tubing must choose to improve an old technology (steel) or to develop a new material (carbon fiber). The decision must take into account a complicated context: increased demand for the "old" steel products made in Italy, increasing power of carbon fiber manufacturing partners in Asia, growing wage rates in Asia, and high wage rates in Italy. Two plans have been presented to the CEO, Antonio Colombo. The first is to push development of all of the company's technologies, perhaps even seeking new markets for them. The second is to rationalize operations and to redirect R&D resources to marketing of stylish, lower-tech bicycles. The company's future hangs in the balance.

Keywords: Decision Choices and Conditions; Resource Allocation; Production; Research and Development; Technology; Bicycle Transportation; Asia; Italy;

Citation:

Snow, Daniel C., Gary P. Pisano, Elena Corsi, and Gudrun Urfalino Kristinsdottir. "Columbus Tubing: Steel is Real." Harvard Business School Case 609-042, September 2008. (Revised August 2009.)