- Either the eng team is a tragedy of the commons, a place to graze whatever sheep you care to send their way, and sure why not let your friends and neighbors also come graze here too? After all, it's not like YOU own it, it belongs to the EM, right? And it's the EM's job to figure out to sustain 100 sheep on a 10 sq ft plot of grass, right? After all, that sounds like some cool engineering whiz shit (to invent hyper-efficient grazing), doesn't it?
- OR, the eng team is YOUR resource, and you don't want others to graze on your land for free...
IMHO, I don't even know that I'd call it a "high quality" vs low quality thing; I think of it like, making a choice about what you want your product <-> eng relationship to be like - do you want your eng team to be thoughtful and do "deep work", or do you want them to optimize for context-switching and multi-tasking? I know it sounds like "deep work" is always the right answer, but it might not be, in all contexts (... okay it probably is right, in 90% of contexts).
These kinds of divisions were tried in the middle of the twentieth century when all big companies had dedicated research divisions: think Bell Labs. While the technology outcomes were often spectacular, very little money, if any, were made from these divisions.
On the other hand, if all you do is context switching and busy work, then the organisation will never grow and move forward, forever bound by the whims of the market.