I have been thinking about this same topic for a while now and I blame Larry Brown.
I think this team went south right after the championship. In 05 Larry had his ring and lost a lot of his passion to drive the team to be better. I don't want to make it a personal attack because he had real medical issues but the result is the same. The same team that got a lot of it's drive from the coach got their complacency from him too.
Larry forced Dumars to hire a coach on short notice and Flip was the best available for an elite team, he had to hire someone established at that time.
Larry Brown leaving after two years also made it that much harder to get rid of Flip after a year or two. After a long string of coaching changes it would be too much turnover and too many coaches getting paid not to coach.
I don't blame Flip so much because I think he is what he is, he can't push his team to be better with the force of his personality because they are stronger than he is. Flip's knowledge of basketball and his playbook might be great but he is not a leader of men in battle. Larry Brown was, without him the team relaxed.

I just hope Dumars long term plan to have young guys ready to step in when the old guys fade out works or our window might close fast.