As a Tony Hawk fan, and a fan of Tony Hawk Ride, I do see what they were going for with the ultimately failed Tony Hawk Shred. It is just one of those a little too late type of deals with that game (and Tony Hawk Shred is a much better improvement over Ride). It is just too bad that they did not make Tony Hawk Shred the first game and just take that extra time with it instead of pushing out Ride.
The problem with execs running a game company is that I am willing to put money down saying that these execs are not big gamers. That is a huge issue. They are in it for the money and as long as their games continue to sell even if they are milking a franchise, they assume they are making good games. A really good game, like the case with Tony Hawk Shred, if it sells poorly, the company assumes it is a bad game and completely wipe away that entire development studio (yes, RoboModo is no more and a huge factor was the sales of Tony Hawk Shred).
I could throw out countless examples, but the truth of the matter is that as long as there are execs in these companies that are more about the "bottom line" and less about the games themselves, this type of trend will continue. These execs do not play these games. They only go based off of numbers. Justin Bieber sells albums like crazy, but that does not mean his music is good. Bieber sucks balls.
With Guitar Hero, that is just too bad. They just milked it too much. Had they stepped back and not pushed out so many, it would still be around. Think of the anticipation for Guitar Hero 2. Even Guitar Hero 3 had this anticipation for release (not as big as 2, but it was there). Then they tried to compete with Rock Band with Guitar Hero World Tour and then eventually Band Hero. They should have just stuck to what worked as they were making good sales.
One of the issues is not all just the execs though, it is the way these games get purchased. Good franchises are now based on sales, so that means that even if it is a bad franchise that still sells, somebody is still buying it. The solution to this is very simple, but most people will not do it. What people do is during the next iteration of the game, purposefully don't buy it. If the game gets horrible sales, it will be seen that it was a bad game. Knowing Activision, they will try to release a "redemption" game for the franchise after that which will be significantly better (i.e. Tony Hawk Shred). So then we buy that one because it will be much better than the milked thing they pushed to us before.
That will never work because people are dumb enough to purchase Madden every single year and buy every single CoD game that comes out. As long as people continue to purchase milked franchises, they will make them.