As the proposer of the Harry rrat:
Nijisanji has always been hands off for their kaigai branches and let they do whatever they want (except for collabing with Hololive EN/Kson). NijiEN found success because anycolor didn't touched them. But it changed after anycolor saw how successful Luxiem was, and anycolor started micromanaging EN by bringing in Harry.
While the cracks of a dysfunctional community were always there, with people shittalking others behind their back, they were held on by incredibly people like Pomu & Nina who pasted the fragments of the company together into a complete picture. Luca was also actively holding it together as you can see Scarle coming onto him for advice (though his advice aren't from his own but from his mod). The place was clique-y but there is a still sense of unity. But we see what happened, as Nijisanji shirks more responsibility into their hands and people started openly backstab each other, enabled by the new management, they crumbled under the increasing pressure and left. Pomu, the one affiliating herself with the brand the most, was legit scarred by Harry & his goons.
Sayu was clearly micromanaged by Niji and every single tiny mistake of her result in stealth suspension, harry started wielding his authority around thinking he's the best businessman ever. And it probs the same case for everyone other talents. When there is that much of a big presence of control, creativity got stifled and it shows, nijisanji stopped being interesting. Except for Selen who fought against all odds and didn't give a fuck what Harry thinks.
How did holo not land a Harry? Pure luck and not nepotism I guess.