In my experience, many companies legitimately don't really know what to do with very senior engineering staff. And how many distinguished engineers or principal engineers or technical fellows do you really need for your relatively straightforward technical challenges anyway? The IC track often fails to work in practice for the simple reason that technical work at an extremely high level is just not needed at many companies as much as engineers want to believe. Very senior ICs are also difficult to manage in the sense that the more you pin them down to specific work or projects the less you benefit from their skills. But sometimes all you need is to be able to assign someone to a specific project that isn't all that glorious or interesting or hard but is valuable and needs to be done by a certain time.