According to Greek mythology, Daedalus, the father of Icarus, constructed wings using the feathers of birds that flocked and wax from the candles. All of this was so they could fly and escape from the tallest tower where they were held as prisoners. Daedalus warned Icarus not to fly too close to the sun as it would melt the wax and Icarus would fall to his death.
Icarus was initially cautious while flying but gradually grew more confident and started flying higher. He kept flying higher and eventually got too close to the sun. Inevitably, the wax melted and Icarus plunged to his death.
The very thing that made Icarus successful and escape prison is what led to his downfall. Icarus's overconfidence blinded him to the dangers of flying too close to the sun.
Danny Miller observed that sometimes companies follow a similar pattern, where the elements that led to initial success are the ones that cause the failure. Miller named this phenomenon the "Icarus Paradox".
Blackberry could be the perfect example for a company that suffered from the Icarus Paradox. At its peak, Blackberry owned 50% of the US market and 20% of the global smartphone market.
Then came Apple.
Innovating and pushing the technological boundaries, Apple made the ever so loved keypad on Blackberry phones redundant. Blackberry didn't look at Apple as a threat as they believed the iPhone could never make its way into the hands of business professionals. This turned out to be wrong. Blackberry underestimated how quickly the smartphone marketing was evolving. Blackberry was overly dependent on its BBM (Blackberry messenger) software, which at its time was the standard messaging platform among professionals. With the rise of secure messaging platforms across iOS, Andriod, and entry of other players like WhatsApp, Blackberry was on an unavoidable path to failure.
Nokia and Kodak are two other companies that have suffered from the Icarus Paradox.
As companies grow they tend to become complacent and overly dependent on the competitive advantage that led to their success. Companies are blinded to the new dangers that arise as a result of their successful growth.
One of the best methods that companies can use to protect themselves from the paradox is to continuously evaluate themselves. Within rapidly growing industries, a strategy of "if it ain't broke, don't fix it" is almost always destined for the company's doom.