MODERN STRATEGIC MANAGEMENT PRACTICES AND ORGANIZATIONAL PERFORMANCE IN LIBYA

Abstract

This research examined the relationship between two contemporary management theories, namely Chaos Theory and Blue Ocean Strategy, about the effect on organizational performance within the framework of the Libyan business setting. The data were collected using validated questionnaires containing items on Chaos Theory (26), Blue Ocean Strategy (10), and Organizational performance (11) among 204 subjects from different industries in Tripoli. The reliability of the scales was determined to be sufficient (Chaos: α = 0.881; Blue Ocean: α = 0.800; Performance: α = 0.873). The factor analyses verified the dimensional structure for each scale. In the regression analysis, 45% of the variance in performance was accounted for (R² = 0.450). Only the planning dimension of the Chaos Theory had a positive impact on performance (β = 0.199, p = 0.04), while the leadership dimension negatively correlated with performance (β = -0.136, p = 0.006). As for Blue Ocean Strategy, it had a positive strong effect (β = 0.431, p < 0.001). On the other hand, the Red Ocean Strategy was unexpectedly found not to affect organizational performance.