The book offers a fresh insight into contemporary challenges in the area of innovation and innovation policy, with a focus on specific sectors (tourism, agriculture) of two small countries, Slovenia and Montenegro. For these countries, the innovation policy is even more challenging, since they cannot influence the external environment, but need to adjust. The authors have successfully placed the position and the policies of these countries in a broader regional context of EU, EU innovation policy and competitiveness of enterprises in EU. An important value of the book is its detailed and theoretically well-founded analyses of innovation in service sector, which is having increasing role in development of individual countries and global trade. The contribution of the book is significant also in the segment of non-technological innovation. The latter can importantly contribute to the competitiveness of these two countries