Rather than just outright dismissing what he said without any justification, did you consider that he actually had evidence/experience that it indeed did reduce the cost? In terms of risk in particular, having two teams work on the same product significantly reduces the chance of not having a viable product by the deadline. Assuming e.g. a 50% chance of failure, having two teams reduces this chance to 25%.
Maybe you get this one project out the door, one team wins, the other one loses. Great. And then what? Half the other team quits since they didn't get that bonus and feel betrayed by management. The other half stays, but resents both management and the "winning" team. Now you reshuffle, and those guys have to work with each other. Start the game anew, with a new project? Great, now people know what's up and will play their cards accordingly. Infighting is guaranteed. That's a terrible way to manage teams. Short-term gain? Maybe. Long-term destruction? Basically guaranteed.
The "without any justification" part of your answer dismisses that that's exactly what the original article is about that we are discussing here. That alone is justification and it matches many people's experience.
I'm personally experiencing the exact opposite these days. I'm thriving on my company not doing this nonsense and we are doing fantastic!
The key thing is that nobody's presented any evidence, just some anecdotes. Clearly there are places that have internal competition and have done quite well, like Amazon (compared to e.g. GCP), or many trading firms.
It's anecdotes from people having experienced anxiety, toxicity and overall bad work climate leading them to either quit or seriously consider it themselves or hearing it from their colleagues.
And it's other anecdotes saying "some companies have done quite well".
I personally have experienced it and I won't go back. And I have also personally experienced the opposite and now I'm having a blast without this nonsense.
But sure, let's just say "nobody has evidence, maybe it's great, maybe it's not".
Your argument that Amazon does great does not provide evidence. Maybe they's do even better without this crap, or maybe the employees would be happier.
As someone who has read histories and has been inside a courtroom, I’m curious what you mean by this.
...if failure is independent, sure. Not only is independence generally a dangerous assumption, but in particular when it comes to software engineering, it's been shown that problems are not independent. I don't have the reference at hand, but if I did, I could show you that completely separate teams tend to make the same mistakes.
The opportunity cost is the productivity of an entire team of developers who might well be better employed doing something useful.
Plus all the bad feeling when one team "loses."
It's irrational sports cult management - competition good, cooperation bad.
It's how it works in a lot of successful trading firms; Jump Tower and Citadel for instance have competing internal teams. Reduces the risk to the firm because if one team's approach fails, chances are another will still be doing okay.
(Not drawing other parallels to nazis here, please don't accuse me of that.)
2 is still pretty good for a lot of things though. Specifically, the features and changes you need from the thing can be prioritized
It doesn't stop at 2. When I left Amazon about a decade ago there were at least half a dozen digital money services/products. Each vertical (retail, 3-p retail, Kindle, Gaming etc.,) all had their own stored-value service managing a slightly different version of the same digital money (gift-card, merchant balance, game coins). The feature sets overlapped ~95%. It may well turn out alright for the company but if you are an engineer or manager tasked with building yet another such service it's no fun at all.
P.S. It didn't start with McDonnell-Douglas acquisition - 737MAX is not the first 737 with deadly design failure - the first one was the original one. Except there Boeing also destroyed evidence from wreckages to hide the issue.
If all competition withing an organisation is destructive, is it still destructive if it happens withing parliament? Thats a single organisation that needs to get things done. What about withing a government or a political party?
What about withing a country, is that not an organisation? Organisation is not defined by the payroll department after all
I had the exact same interaction with a VPish person. The concern in my tone didn't even register with him. He said, let them all build, and may the best tool/service/library win. There is no such thing as healthy competition; it always tends to get vicious and ends up really badly for one of the teams.
If you acquire a competing company, you ideally assimilate the employee work force and integrate them into your organization. You welcome them and make them feel home from day one. At least those that you keep. There are likely a few that you let go. But it's really important not to get hard feelings in there, 2-tier engineering, internal competition. I'd quit immediately any organization that doesn't understand this.
Unless your definition of small companies is just one person. This doesn't stand.
There is internal competition every where. In fact internal competition looks like a nice name to describe a more maligned name politics.
One anecdote I faced once was talking to a senior engineer at a FAANG company who was complaining that he just discovered another organization building the identical product his team had spent over a year on, saying that management was so disorganized it must have not realized it. A couple weeks later I happened to talk to a VP up his chain of command, and mentioned this to him, and he chuckled and said "oh yeah that's by design, I'd rather have internal competition than external, it's worth the cost". Was a good reminder for me to avoid large companies.