Abstract: | Small and medium enterprises are faced with serious challenges. Expansion of global economy, deadly struggle for the markets, drastically shortening of product’s life, rapid technological changes, structural transformations and etc. In order to respond to these challenges, the enterprises need to increase their productivity constantly, to improve the quality of products and services, develop new products and meet the requirements and desires of the consumers. In short, the enterprises have to be innovative all the time, because the imperative of modern business is improving all the components of the structure and business of an enterprise. Capacity of small and medium enterprises to bring more quality, functional and cheaper products on the market indicates the development of innovative processes in those enterprises. Most frequently, new products, which represent the guarantee for their successful work, represent the innovations in small and medium enterprises. Small and medium enterprises are more flexible and easier for adaptation in comparison with the environment and thus, they are far more easily adapted to new circumstances in comparison with the need for innovation of products and services. The role and influence of entrepreneurial innovation in the development of small and medium enterprises is special. It is the key factor of economic development in Serbia, because, according to the relevant data, there are over a hundred thousand companies and over two hundred thousand entrepreneurs that employ 60% of total employees and that participate in social gross product with 50%. The aim of this research paper is to indicate the need for raising the level of innovation of small and medium enterprises through the structure of production and service activity in which new product has a primary role. |
