I think it could work if it was designed for it from the ground up. Google's experiment's lasted months, and was, what seems like a whim of the owners, where as a lot of the workers probably expected a traditional company.

Valve the "game" company, has a relatively flat structure from what I've heard, and it's working pretty well for them, but they've also had it for a long time.

So if you have a company, that works like that from the start, that people know it works like that, that it has support for it. You could make it work.

I agree that forcing this structure everywhere wouldn't work, some people can work like this, others can't.