I suspect it's more of a human nature problem. Perhaps a good work culture might allow you to delay its oncoming slightly past 7 people - but eventually all large social groups get political dynamics.

Yep - I mean, to some extent, he’s right, as the problem was that there ended up being a perceived divide between team leads and teams - so with the rotating teams everyone who wanted to got to have a go at wearing the team lead hat, which both allowed people an opportunity to interface directly with the big bosses on the regular and feel seen (even though we were very much hands on with everyone anyway), and to understand that herding cats wasn’t as much fun as it looked like from the outside.