Nonmarket paradox

The fundamental paradox of any corporation is that even though it competes in the marketplace, it uses nonmarket instruments - plans, commands, controls - to accomplish its goals.

Example: When Zara (Spanish fashion retailer and label) wants to design a new dress, for instance, it doesn't put the project up for a bid to different outside treams to find out which one will give it the best price. Instead, one of its managers tells it design teams to design a new dress. The company trusts its designers to do a good job for their employer, and the designers trust the company not to make them bargain for a job every time a need arises.