This is why these large companies often form "innovation" units that are spun out as separate entities or at lest setup as separate orgs sheltered from internal politics by the C suite.
It's possible. But it's really hard work, very politically expensive, and extremely high risk. So, yeah, not surprising.
I have seen a company spin up and after 2 years spin out a seperate innovation unit, and when it was a proper seperate entity outsource their core IT to the unit... Which was then branded a big success! It was liberating to see such systemic incompetence; The people were all highly educated but as a group just can't seem to organize effectively.
This Sounds like financial engineering. It is possible the people involved were incompetent, either individually or as a group. But this sounds like an incentive problem. Competence, misdirected.
> Branded as a success
I fear you aren't cyncical enough.
Was it a filure? Did the company's balance sheet improve? Did the company's stock price increase? Did the spinout attract a load of investment for its (pre-destined) success and turn that into a rich revenue stream?
Markets -- for both debt and equity -- are mostly idiotic machines on short timeframes. Your ability to generate free cash flow puts a floor on your price. Others' imagination and available liquidity are the only ceilings.
Additionally, these types of spin outs can behave like generational wealth. They may be incompetent idiots, but who cares? Daddy's money is more than you can raise and mommy's rolodex is richer than you could possibly imagine.
It's possible. But it's really hard work, very politically expensive, and extremely high risk. So, yeah, not surprising.