Let’s paint a scenario:
The Pittsburgh Pirates have an outfielder who put up a 3+ WAR in his rookie season, and a 5+ WAR in his third season.
The Pirates, during this same time, were one of the worst teams in baseball. This outfielder represented one of their few glimmers of hope that a contending team might one day soon be on the horizon.
Unfortunately, that outfielder is under control for four remaining seasons, following his 5+ WAR in another losing season. In order to contend with this outfielder, the Pirates needed to either extend him, or trade him to add players who will be in the mix when this is a contender.