The aim of this report is to provide an overview and a systematic analysis of the digital innovation ecosystem, as a network of innovative actors who connect online and interact digitally in ways that create value for all, for small and medium enterprises (SMEs) in BiH. This research relies on a mixed-method approach, split into two phases. Firstly, an extensive desk review was performed, surveying the primarily strategic documents related to improving the digital innovation ecosystem for SMEs in BiH. Secondly, semi-structured interviews with local and international key stakeholders in the digitalization reform processes were conducted.
Bosnia and Herzegovina faces challenges in the competitiveness of its human capital and the availability of ICT specialists, hindering digital innovation. Most SMEs have not adopted digital technologies, and e-commerce is hampered by high shipping costs and expensive online transactions. Additionally, SMEs lack awareness of cyber security's importance, perceiving it as a costly and unworthy investment. Faster and better reaction by regulators at all state and entity levels is needed, to stimulate rather than slow down technological progress. Specifically, an institutional framework for SMEs digital transformation at the state level is needed.
Key recommendations include establishing an online platform to enhance awareness and capabilities of Bosnia and Herzegovina's SMEs for digitalization, facilitating the matching of demand and supply for digital solutions. It's crucial to provide both the demand and supply sides of the market with access to financial resources for digitalization. Encouraging proactive cyber security measures through collaboration with specialized companies and addressing payment and postal service costs in e-commerce through legal and technical infrastructure improvements is also essential.
Full Report and the Extended Summary can be downloaded here: