You’ve hit on a big reason - short term gains. The partners at Accenture, Infosys and the rest circle the execs at old industry companies. The companies start performing worse, though nothing some accounting gimmicks can’t cover. Then they have a very bad quarter, enough that it will ruin their fiscal year. Fingers start pointing, and talk turns to “belt tightening” and “turning fixed costs to variable.” All of a sudden the proposals from Big Consulting that provide savings bankable this fiscal year sound very good.

It doesn’t take long for the cracks to show:

- Not enough program/project management.

- An intuition that service dropped but no good metrics.

- Retrain the outsourcers after the first team quit.

- Inability to size new projects.

- Shadow IT departments form in the business units.

- The outsourcers don’t care about things like vendor consolidation or holding other vendors feet to the fire.

All of this might still be worth it if it’s done strategically to improve a chronically underperforming IT department. It’s rarely effective when rushed to cover up poor performance of the core business.