> My assumption is that upper management doesn't want to admit they've made a mistake in hiring their subordinate managers.

Avoiding situations like this is why we praise failure. When someone says “I made a mistake, this is what I learned, and this is how I will avoid making the same mistake” I give them much more respect then when they are just accepting bad outcomes.

Edit: And when I work with someone for longer than a year and they haven’t claimed any failures I assume they are either covering them up, not noticing them, or not engaging in risky enough behavior.