modern militaries still use formations because they work. For example one type of formation used, the squad column fire team wedge allows the lead unit to make contact with the enemy without revealing the true size of the unit. This is beneficial for several reasons. If the enemy that has been engaged radios higher they will report that they have made contact with a team size element (4-5 soldiers) when it could a full platoon (35-40), the enemy will also not know that the other team in the lead squad could be outflanking them because they wont even know they are there
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