Hodgepodge or Timbecile would probably know better than us why 3DO went down the tubes, but my own personal opinion is that it is usually a mistake to to let the bean-counters have the last word in a company when that company depends so much on inventiveness and creativity.I was told that 3DO put their main resources behind a game called The Army Men because it looked to be selling well. If that were so, it obviously didn't sell anything like well enough.
But what the actual reasons were, I don't know. I didn't enjoy the best of the HoMM games as much as the worst of the ordinary Might & Magic games.