Sure you do. It allows someone at the top to flip the switch between market and central command. Ideal firm size and vertical consolidation varies between industries, and plausibly varies in different environments, different times, etc.

Looks like the joke is on the winning team.

I don't buy the "first to win argument", but it would seem useful to take multiple approaches to solving the same or similar problems.

One of the thorniest problems in business economics is this: we know free markets produce extraordinary results, but why is it that even in the absence of regulation, so little of the economy is structured as a free market? Very few businesses of any size operate internally as a market, instead they usually operate under hierarchical command and control. Markets generally exist only at the interfaces between organizations.

Why don't teams bid competitively within a company? How do individuals decide on the teams to form? Why are managers allowed to rise to the point of failure? Why do we pay people salaries instead of hourly wages? Why do we hire hourly wage labor as if though its was permanent?

The number of questions raised by this topic is endless.

The most general explanation is this: yes, companies adopt inefficient structures, but they more than make up for this through significantly reduced transaction costs.

Nations almost all adopt an executive system because nations compete. The U.N. doesn't because Earth doesn't have to compete with anything else. Imagine a competitive interplanetary situation and you can bet the Secretary General of the U.N. would quickly gain significant decision making powers.

Collectivist market philosophies tend to be built on the assumption that there will be no competition internally and thus can be run by various committees. However, even countries trying to follow various types of collectivist ideologies ended up with single executive-types at the top, again because countries compete.

On the small scale, many indigenous tribal systems rely on a council during times of peace, and elect an executive (sometimes called a "war chief") during times of war.

The phrase "business is war" is particularly appropriate since most businesses operate like they're at war.

That's how the Roman Republic operated, too: the Senate would elect a dictator for six months to handle certainly irregular situations. Unlike any other Roman official, he had no colleague who could countermand his orders, and he was not legally liable for any act he committed in office.

Could you give an example of this? Are you talking about using contractors to get through a project, and then keeping them on indefinitely after the project is over?

At the current cost of hourly labor if you made it even more like temporary labor than it already is the quality of worker you could obtain at that price would be terrible.

If you believe current US (at least for most of the population) law theory, all employment relationships are completely at-will. They may be terminated at any time for any reason. I would argue that is all that is required for a free market. This would seem to contradict the claim that most companies to not internally operate as a market.

I know there exist serious breaches of this freedom (ie. slavery), but it is not supposed to be the norm anymore.

https://en.wikipedia.org/wiki/Theory_of_the_firm

although I think fiatmoney is conflating a centrally planned command economy with communism.

Seems like a distinction without a difference, considering that every time a nation tries to implement the latter they end up with the former as an "intermediate stage" of the revolution that somehow never goes away.

In a corporate body, there is no pretense that central planning is a transitional stage. There are a few exceptions like Valve and Zappos, but even fewer genuine success stories where a non-hierarchical structure has outperformed traditional ones in the long run.

http://www.inc.com/audacious-companies/leigh-buchanan/mornin...