Have been pondering Malcolm and JP's posts re: Paul Graham's "What business can learn from opensource"

Having thought about it it's pretty obvious that the employer/employee thing doesn't scale very efficiently. The whole structure is top down and fundamentally limits innovators at the bottom (i.e. most of the workforce) both in their motivations and in what they're able to observe and do.

E.g. Sure, I can optimize my IT day-job to oblivion, but what ensures that the innovation translates into effect on the company bottom line? More to the point, why should I worry about the company bottom line? - my financial reward is based more on internal relationships and yearly appraisal processes than carefully managing the bottom line. AFAICS the feedback loop is too loose and slow to be anywhere near optimal.

So my question is: could investor/founder work better on this scale? If everybody's salary was scrapped and then came in to work the next day to attempt to earn money by offering services to other people/teams on a real-money basis, what would happen to the company? What structures would result? Would all the tight-feedback value get eaten up in the contractual/accountancy noise?

And on a practical note, could this be incubated on a small scale within a large company?

(caveat: am totally out of my intellectual depth)