Assuming you're trying to build a large, effective organization, how do you do it without some level of internal competition? I've worked for some relatively touchy-feely companies (*cough* Linden Lab) that prided themselves on being "flat", but eventually I realized they were just keeping all the politics quiet and subtle. Meanwhile, people worked on "fun" stuff and added neat but unimportant features to Second Life while neglecting its stability and maintainability, with the ultimate result that instead of trying to improve it, New Improved Corporate Linden Lab has decided (probably correctly) to do a complete rewrite in the form of Sansar. CouchIO had similar problems trying to essentially be a distributed open source project with money.

But maybe it's not necessary to build large organizations in the first place? I'd love to believe this. Perhaps something like the contract market in Earthweb is the way to go.