Human resources are the most valuable resource of the organization and they use and manage other resources in the organization (financial, material and information). The success of the organization is based on the quality of human resources, their competencies, motivation, loyalty, and their business results. The basic aim of this research is to determine whether and to what extent Human resources competency management influences the business success of small and medium enterprises. The empirical research was conducted in 234 small and medium enterprises in the Federation of Bosnia and Herzegovina in January 2021. An original questionnaire was created for the survey, which gathered the opinions of top managers on Human resources competency management, as well as on four business performance perspectives based on the Balanced Scorecard model. In the doctoral dissertation, Human resources competency management is viewed as a process consisting of: determining the required competencies, determining current competencies and the competency gap and undertaking activities to ensure and develop the necessary competencies. For the business success of small and medium enterprises, business performance was researched through four perspectives of BSC (financial perspective, customer perspective, internal business processes perspective and learning and growth perspective). The research results showed the correlation between the studied variables and the influence of Human resources competency management on the business success of small and medium enterprises viewed from all four perspectives. The dissertation includes a comparison with similar research and recommendations for future research. A limitation of the research is reflected in the extent of the sample and the method of creating the research sample. Some qualitative data that enable subjectivity were used in the research because a subjective evaluation of state as well as impacts has been conducted. The originality of this work lies in creating an original model of the connection between Human resources competency management and business success (performance) of small and medium enterprises as viewed through four perspectives of the Balanced Scorecard, which has been empirically tested. Also, no such research has been conducted in B&H to investigate the influence between the Human resources competency management and the business success of small and medium enterprises.