To the question in the OP, while I agree with a number of reasons people already mentioned, I also think it isn't always a 'bad faith' move, or on purpose. I think it's also often an 'I/we know better' or a 'let's try this first' of the management vs idols' opinions, and sometimes it works and sometimes it doesn't.
Let's be fair, idols' opinions and ideas aren't always better even if it's about their own career - I recall Taeyeon saying she disliked 'Gee' and didn't think it would become a hit when the company switched from 'Dancing Queen' to 'Gee' - yet it became the song that launched SNSD into the stratosphere.
Same for netizens and K-pop fans, it's easy to be armchair generals or say in hindsight 'the company should have done this or that better' - everyone can be truthtelling prophets, in hindsight. But how many times have K-pop fans predicted a song was a flop and bad move and a group has become a flop - only for that song to become a monster hit or that group to rise up and become extremely popular and successful?
Company people can be wrong, idols can be wrong, netizens and K-pop fans can be wrong.
I also think that it's a matter of resource limits and core strengths of each company. Due to limited resources in money and available supporting talent, companies need to decide what group should get focus first and get access to those resources, and decide how to spend those for maximum effect.
This may run against the inbuilt limitations and weaknesses of a company.
For example, SM simply doesn't have the expertise, connections and networking structure for international/western expansion, even if they want to and try to for their groups. Which makes it harder for SM to make their groups grow outside Asia, at least harder than other companies. Fans might pull out their hairs about the many missed international opportunities of their groups - but it's not as if that's SM's strength.
And YG, for years, YG has had its entire organisational structure built around having their groups' songs not be bought but be produced only inhouse by a few genius composers/songwriters, and only the highest quality was acceptable. But this production and brand building philosophy has the weakness your song and album production will be inconsistent and comebacks sparse - fans might complain to high heavens about the long hiatuses of their groups, but YG's way of producing songs simply can't deliver more due to its limited capacity.