Introduction

Starting a new business obliges everybody to be well informed about the issue. The satellite radio service is a sphere of research and practice in the digital satellite broadcasting systems, when audio is spread from orbiting satellites to receivers, on the surface.

Sirius Satellite Radio is a system of service that provides listeners with music, entertainment, sports, weather and news channels for 24 hours a day. It delivers its products in almost every genre on the uncensored and commercial-free basis. Satellite radio products are delivered to the auditory in the truck, boat, shop and home. Many automotive brands begin to offer such kind of service. Customers can also receive it over the Internet.  Thus, Sirius Satellite Radio is the foremost radio provider in North America, but it has considerable perspectives for development in Europe, as well (Jorge, 2002).

The major goal for a company, which wants to enter the foreign market, is the effective adaptation of its products to the terms of market environment and requirements of the clients. That is why, certain studies must be done under particular directions in order to achieve this goal.

The first satellite radio was introduced in Europe, in 2007. According to the market research study, Italy gives the best chance for satellite radio in Europe. Italians are passionate radio listeners.  Statistics shows that more than a half of the population listens to the radio every day, but traditional radio stations does not provide the necessary variety of activity. Moreover, there is the flourishing car culture in the country. The market is highly technologically advanced for the handheld devices and is also opened to the new technology. Hence, Sirius Satellite Radio has an enormous potential to grow there (Povoledo, 2006).

This paper identifies the basic aspects of satellite radio service at the Italian marketplace.

Internal Environment

Service management focuses mainly on the supply aspect of a business. Organizations are workable in the modern environment, when they provide satisfaction to the customer, especially in the service industry. The need of identification, forecasts, analysis, conversion and integration is a continuous process. Therefore, the primarily management functions such as planning, leading, organizing, implementing and controlling play the key role in any business.

Short-term planning is better used in the rapidly changing business environment. In executing planning, organizing, and controlling functions, managers should be clearly concerned with the way their actions affect human behavior. At the same time, they must know how the behavior of the subordinates influences their actions.

As relationships are crucial in Italy, the relationship-oriented approach should be taken. Management style tends to be similar to the parental type, but a competitive manager can combine the authoritative approach with a concern for the well-being and dignity of employees. The manager must not only set the corporate culture, but also distinguish the certain parameters of work, that is in subordinates’ charge, for effective direction. The best team work is made under the direction of the authoritative manager, who can give a clear focus for every team member as well as generate a sense of loyalty and enthusiasm to the whole team (Jo, 2011).

The manager must also exercise control in order to ensure that the goals are accomplished. Control of costs, quality, and schedules are at the core of the management process. Preventive measures, such as contract making and control over the situation, will allow the decreasing of breakages and unplanned stops.

External Environment

Understanding of country’s external environment is a vital factor in establishing strong relationships, in the foreign market. Management should counteract the harmful factors and gain from the beneficial ones, from the external environment.

Italy is a politically stable state. The government’s laws are established, and they put strong efforts to control the inflation levels. Corporate legislation, including tax laws, intellectual property protection and foreign investment, are created at the state level. Investment opportunities are also encouraged by a number of government incentives. Thus, an overall investment climate is mild.

Italy belongs to the 7 largest economies in the world with a potential to develop further, but it has a disproportionate share of economic activity in different regions. Nevertheless, the level of industrialization and infrastructure does not influence the satellite radio service seriously. The money supply is stabilized. Incentives, in the form of cash grants, subsidized loans, tax credits and leasing assistance are available for the technological innovations from the Italian government as well as the EU authorities.

For doing business, it is vital to have contacts, as Italians prefer to do business with the familiar people. Thus, business centers on building relationships. Consequently, personal networks in the business community are necessary conditions. Courtesy and the respectful manners are highly appreciated qualities in Italy. There are protocols of etiquette that are adopted for commercial situations. Conversely, considerateness is put above the behavioral principles. Hospitality is fundamental for business culture (Background to business in Italy).

English is widely spoken and understood in Italy, but the national language is Italian. Local dialects are also spoken by a large percentage of the population in certain areas. Therefore, it is recommended to make it clear, which language will be spoken over the radio. Obviously, all documents must be in Italian.

Italian religious environment is also favorable, as Italy is a tolerant country for religious minorities. Roman Catholics make the majority of Italians. However, other religions have freedom of actions in accordance to the law of the EU.

On the one hand, local radio stations, as well as the manufacturers of mobile entertainment devices, can be the main competitors in the satellite radio service industry. On the other hand, the company does not have the direct competitors and threats. Thus, it will be an active player, who is able to take the leading position in the competitive environment.

Entry Mode Section

According to the regulations of the EU and principles of the General Agreement on Tariffs and Trade, import is free, while export usually is unrestricted.

The Bank of Italy supervises the financial activities such as franchising, turnkey operations, and licensing. Licensing gives the opportunity to invest close margin of capital and, thus, avoid the risk of economic failure. The licensing arrangements are attractive for foreigners in Italy, as there are no exchange control limits on the transference of payments overseas. Franchising is mostly proposed for distribution firms. In spite of it, there are no standard contractual schemes that mean an existence of the legislative gap.

There is a wide range of legal entities in Italy. Moreover, the business can be set up in the shortest time due to the “Sole Communication” of Register of Companies, Labor and Tax Authorities. Several forms of joint ventures run there. As for the wholly-owned subsidiary, the foreign corporation is obliged to inform the local court. It must give the names of the resident persons, documents and register the local branch. Consequently, companies must provide specific information about their activity. The service can be also sold or leased by way of turnkey operations (Doing business in Italy, 2010).

It is recommended to create a Limited Liability Company. It can be managed by a Board of directors as well as a sole administrator. The company will have the considerable advantages, including the ease of attracting investments, the opportunity to use talents, knowledge, and experience of an unlimited number of people, the financial power to research, develop, and produce new goods.

International Functioning

Marketing is the critical aspect that helps meet the demands of the consumers. Market requirements are considered even before the presentation of services. The international marketing research showed that satellite radio services were successfully launched in the world as well as in Italy with other European countries set to follow. The market risk can be avoided by a systematic improvement of service quality, setting business dealings, using active market measures and searching the new perspective markets.

Italian finance and accounting principles are directed by civil law. The accounting conditions together with the financial statements are regulated by the Italian Civil Code. The directors ought to prepare a report thereon and the annual financial statements every year, at the end of each accounting period.

Human resources management is the engine of the whole project. That is why, the satellite office management must focus its attention to those aspects that will bring motivation to the employees. This plan requires the formation of training committees composed of management members and workforce.

The best attempts to reward people can be realized through the specialized pay approaches, such as ‘bonus programs’. Encouraging work-force flexibility and innovation should be done through such means as skill-based play and gain sharing. In fact, projected work creates the internal motivation, feeling of the personal contribution to products’ making. Nevertheless, economic motivation remains the best mean of labor stimulation. It can be reached by establishing a system of bonuses and fringe benefits (Larson & Gray, 2002, p.14).

There are no such methods of personnel motivation that are effective at all times and under any circumstances. However, any applied method is based on the strategy of human resources management. It means that the choice of concrete motivation must determine the general strategy of personnel management in the first instance.

Operations cover finance, marketing, operations and human resources management as the main components of operations management. Thus, a systematic approach is necessary in order to conduct its operations. The concept of operations management can be viewed in the manufacturing industry as well as in the service sector.

Cost/Benefit Analysis

Organizational investigation is the approach in which the organization’s structure, ability and performance are examined in order to improve its effectiveness in terms of performance. Analysis demonstrates that radio has a 49% better ROI than TV. Furthermore, it always had a total return of the investment. Organizational study can be explained by using different principles and concepts that emphasis upon the return on investment of the project.

Strategic plan is a central issue of every competitive analysis. It provides course for the internal organizational departments, such as accounting, finance, operations, purchasing, human resources and information systems; as well as for external sector. Different strategies such as the cost benefit analysis, valuation, life-cycle price and the effective tender to manage overall construction costs must be engaged. The risk plan should also be enabled by the project team in order to assess the progress of its work (Barkley, 2004).

The processes of strategy adoption and location consideration are principal to the efficient operation of the company because of cost considerations and efficiency matters. The company should always keep the focus on service along with lower price and high quality products. The commercial-free service will attract the large audience due to the relatively low cost. It is the optimal process strategy that will improve the performance of the company to the great extend.

The satellite radio creates new audience and opportunities for the host government, as well. It provides the additional economic growth and expands the competitive environment. Therefore, the government encourages the introduction of the new technologies and such innovative projects.

Conclusion

The effectiveness of every project depends on the way the team members work together, but there is also an external environment with the laws and regulations.

The Italian business environment is rather favorable. The political, economical and legal systems are stable. Besides, there is the opportunity to springboard to other markets. Italy offers the primary entry into the European market that can be potentially larger than in the United States. Thus, business has plenty chances to grow and provide the return on investment of the project. Nonetheless, it is a foreign country with a unique approach and business outlook. As a result, one has to research peculiar cultural and commercial sides before trying to do business there. It is vital for every organization to practice cultural values that foster strong working relationships between the employees and the management team, between the organization and the outside world. Relationship-oriented approach has to be taken into an account in the first instance.

Proper operation of the business system requires the establishment of effective human resources management. The results of operations are mainly influenced by the next factors: the dependence in the processes of manufacturing, distribution and sales upon the third parties and new market for this kind of service. Hence, every aspect of the internal policy must be well-organized and structured. In this regard, leadership stands as the most significant factor that influences the vision of the company.

Nowadays, satellite systems have been already incorporated in every sphere of human life. According to the market research, this tendency will only progress in the future. Based on this plan, forecast is optimistic for the satellite radio service in the realization of its goals and mission. The Italian market offers the perspectives for company’s business success. To sum it up, the return on the investment of the project will be positive for the company together with the host government.

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