There's only one problem with that rule: This is not done to dev estimates, but to the estimate of the next lower level of management. If your project has 5 levels of management before all participants are under one umbrella, team estimates in days will lead to a project taking years.
Claiming that the organization is flat is no cheat though: Create phantom managers so that ever 6 people have a manager, and those managers have managers, until the structure has a root. 300 programmers without managers would get 50 phantom first level managers, who have 9 phantom second level managers, 2 phantom third level managers, and a single phantom project managers. If an organization has more management layers than that, they will be even slower.
Claiming that the organization is flat is no cheat though: Create phantom managers so that ever 6 people have a manager, and those managers have managers, until the structure has a root. 300 programmers without managers would get 50 phantom first level managers, who have 9 phantom second level managers, 2 phantom third level managers, and a single phantom project managers. If an organization has more management layers than that, they will be even slower.