In Military Operations, starting with strategic planning to deployment of forces in the area, its usually better to have one commander from the word go to the very end. Such a pathway usually yields results. The most experienced officer is the COAS, and his retirement means that his career has now finished and his services are no longer required. Even if he may sit on a decision making panel or as a think tank or as an adviser - he has already lost that power of making any decision. He can just give suggestions and throw around ideas. The next COAS now holds all the power and now he has to enact his decision making powers and give orders. In Military planning, a new commander will always have new plans to enact action. He could go enact those decisions on: planning from his MO Dte, changing circumstances (Govt + country + Regional + Military) as time passes, his own experience and his cadre of advisers or merely his gut feeling. In infantry, if a commander says attack from a left, the whole battalion will attack from that direction. In Artillery, calculations (such as trajectory etc) rule the decision/direction for attack. Decisions taken by the COAS can be circumstantial or based on calculations.
I once asked a close associate who worked in his Dte in GHQ, that Bajwa lacks that luster that RS held or other prominent COAS had held in the past. The reply i got was that Bajwa sometimes moves with snail's pace but consolidates every step ensuring that the last decision/action was the building block for the next. Some other officers regard him as the brain behind many military achievements on which he doesn't agree to take credit. Some say that in Feb 2019 incident, he let the CAS take the lead for retaliation against IAF, which a COAS normally doesn't do. He certainly isn't flamboyant as Musharraf or a heart winner like RS.
The statement issued by the government for his extension is "regional security environment". The team (COAS + PM) can remain the same if there is a long term plan that envisions and implements the statement given by the government. It may not be a 1 year plan, it could be a 3 year plan. Some people/members may look at it this way that PM IK is new to the political arena and has arrived to take reins at a time when the country had just started to stabilize mostly due to RS efforts while NS was in power - so IK needs support from the Military, solidly from the current COAS. A different cadre feels that ousting NS and bringing in IK has been achieved due to country's intel agencies, such as ISI. They think it was felt that while RS was throwing in effort to develop the image of Army after it was ruined by both Pervaiz's (Musharraf and kiyani), the civilian leadership was not doing its part in progression of Pakistan and its image. NS and his party was not concerned with Pakistan other than an opportunity to sit in power and make money just like before (90's) - however times had changed and Pakistan was standing in turmoil with enemies from with-in slowly bleeding it, while external enemies had surrounded it like never before. So a new junction of military-civilian leadership was required, both working sincerely for Pakistan. A pair leading both blocks without friction between them. Others may also look at it from Kashmir point of view - that Bajwa has mostly been posted as commander in AJK and CFL/LOC regions and is the best candidate to lead the Army at this point in time if a war erupts over Kashmir which may somehow give an edge and Indian media has also been screaming about this point concerning Bajwa.
This extension seems to be more of IK's plan than Bajwa's. Time will tell if IK has achieved the vision and implemented the plans that he holds by extending tenure of COAS. If there is certainly a plan in place on which IK wants to work together with Bajwa as COAS and hopes that the Duran line issue, internal security matters, Taliban-US issues in Afghanistan, kashmir issue, CPEC generally, foreign relations and other threats faced by Pakistan will get solved, probably three years could be enough to solve one or two if not all. On the contrary- unbiased - yes IK could use this extension as means to fortify his own Government for next 3 years. But in past such reliance on Military commanders have been taken by Bhutto and NS - both ending in disasters.
An uncomfortable development is seen after this decision - the disgruntled marching from KPK and now seen in streets of islamabad. Its very difficult to oust a COAS from his seat, its considered easier to oust a PM. There are many factions inside and abroad who want IK to go and dislike the extension of COAS. Those who say that Extension is a gamble, then a new COAS is a gamble too - either way decision has to be made and a decision has been made.
The Lt Gens who are going to come up will probably get superseded and retire. One might make it to CJSC. Promotions in military is another unique topic. Promotions of brigadier and above become awry at some stage of career. A brigadier destined to be become a sure-shot general, while in the excercise area gets a cardiac arrest, he will never reach general rank. A Major General's staff car goes missing, he is superseded and retired. A promotion criteria like number of staff/war courses comes in, a Major General doesn't reach Lt.Gen rank based on counting in competition with other Major Generals. Nothing is for sure above Brigadier Rank.