This pillar evaluates the collective confidence and historical performance of SMEs, noting that both optimism and past success are foundational for business growth and innovation. A positive business sentiment, supported by tangible performance metrics such as sales growth and profitability, anchors SME competitiveness. The assessment combines both subjective views on market conditions and objective financial data from company records.

This pillar examines the range of external factors, from regulations to infrastructure, that influence business operations at the national level. An efficient environment promotes economic growth by attracting investments and fostering innovations, while a challenging one can hinder progress. Indicators, encompassing business rules to public service satisfaction levels, offer a detailed insight into Serbia’s business context.

Focusing on the core of SMEs—their workforce—this pillar evaluates employee skills, availability, and interactions. Acknowledging that skilled and engaged employees are crucial for competitive advantage, the criteria cover both specific skill sets and the quality of workplace relationships. The scope of evaluations includes technical skills, workforce availability, and employee retention challenges, providing a thorough perspective on a company’s workforce capabilities.

This pillar evaluates a company’s strategic approach to maintaining competitive advantage, particularly when traditional methods become unsustainable. It examines whether firms prioritize low costs or deliver differentiated, value-added products. Key factors include e-commerce utilization, customer feedback incorporation, and the balance between domestic and foreign income sources. The pillar also explores constant innovation, product refinement, and market expansion strategies.

This pillar highlights the need for businesses to adopt digital strategies to remain relevant and competitive. Companies slow to digitize risk market irrelevance due to shifting consumer expectations. Emphasis is on cloud computing, social media engagement, automation, and artificial intelligence. The pillar’s indicators measure the depth of a company’s digital transition, from ICT security to software implementation.

This pillar stresses the importance of creativity and novel approaches at both the company and macroeconomic levels. Regions that invest in R&D typically exhibit stronger economic performance. For companies, technological advances drive product and service innovation. This pillar gauges aspects like new process introductions, intellectual property management, and the impact of government policies on business innovation.

This pillar evaluates a company’s environmental accomplishments and future plans. The European Green Deal sets ambitious sustainability targets, but Serbia lags in its green commitments, particularly in energy and waste management. The ability of businesses to compete on international markets, where strict criteria for recycling, energy efficiency, waste management, and other areas are swiftly being imposed, is becoming more and more dependent on investments in green technologies. Indicators assess regulatory understanding, emissions and waste reduction, and investment in sustainable technologies.

This pillar underscores the crucial role of financial resource availability for businesses. Secure access boosts competitiveness by allowing companies to fund operations, technology, and expansion. Key indicators assess the ease and diversity of external financing, emphasizing the potential limitations of over-reliance on internal funds.

The Gender Equality pillar delves into workforce gender disparities. Despite some progress, multiple factors contribute to ongoing inequality, including societal norms and economic challenges. The recent financial downturn and the COVID-19 pandemic have further hindered gender equality efforts. Indicators within this pillar focus on female representation in professional roles, company ownership, and managerial positions.