A key factor in such failure is misaligned incentives. A team in a company is more likely interested in solving problems for the longevity of the company, so th

A key factor in such failure is misaligned incentives. A team in a company is more likely interested in solving problems for the longevity of the company, so they think long term and they iterate. They also learn about the domain over the years. On the other hand, outsourcing companies just want to get a project done in time and under budget, and their hire the least qualified people to just meet the negotiated bar. To that end, there's really no incentive for an outsourcing company to hone any kinds of craftsmanship (there are exceptions in small and specialized consulting firms, of course). Plus, there's always information loss and distortion when a company communicates their needs to an outsourcing vendor. Consequently, all hell will break lose when a project is complicated enough.