I've been thinking about the concept of a "strategy tax" while watching Apple's latest round of App Store policy changes. Competition between divisions within a large company has, at various times, been lauded as a best practice. But danger lurks on both sides of the issue. Too much internal competition can lead to a lack of focus, with divisions pulling in all directions at once, causing the company as a whole to stand still. Allowing too little internal competition, as in Spolsky's Microsoft example, results in the absurd situation where a company handicaps its own products.
Very, very interesting. And timely. Large companies seeking synergy and efficiencies often stop/limit some work and innovation within it's business divisions. Scale slows innovation.