One very serious problem with that idea. Team X isn't insulated from lawsuits that Team Y gets hit with (or contracts that have the potential for massive costs, for that matter).

Suppose Team X isn't doing well. Probability of getting fired is 50%. They decide (independently) to do Z, with a 90% chance of increasing their team's profits (and not getting fired) as well as a 10% chance of major lawsuit that will crush the company.

This nearly doubles Team X's survival probability, while exposing the company to a massive risk. This is a classical example of agency costs. And this is why big companies are usually pyramid shaped.