The idea that there is a certain "natural" size to groups of people reminds me of the Monkeysphere essay:

http://www.pointlesswasteoftime.com/monkeysphere.html

The size of a monkeysphere is estimated to be 150 people, which is quite a bit larger than the 10-person group Paul advocates, but I guess you need to know at least a few people outside of work. :)

I wonder if the problem with large corporations is that you don't care about the other people in them or that you feel the other people don't care about you? Certainly the people in the highest positions can't care about everyone under them -- assuming they can only care about 150 people -- so perhaps that is the limiting factor of effective size.