Competitive coding, despite superficially involving typing code into an editor, has almost nothing to do with working on large pieces of software. It's a lot of rote memorisation, learning algorithms, matching them onto very particular problems, and so on, it's more of a sport. Just like playing too much bullet chess can be bad for your classical chess I can honestly see how it gets into the way of collaborative work.
If you already know that there is a tactic in the position your entire frame of reference changes. Which is actually why puzzle composition is treated very differently from actually playing, and a lot of famous composers are not particularly strong players.
This is why I feel it compares well to coding competitions. It looks so similar, but the mindset is very different. And only looking at tactics, just like only looking at coding as a game problem is I think why it may damage your performance at work.