The company's core competence is a company's unique ability to earn profits, seek survival and explore sustainable development. The company's unique internal performance is difficult to imitate. The external performance of the company is the overall ability to manage risks and seize business opportunities. The purpose of this essay is to analyze and evaluate the advantages and disadvantages of the concept of basic competence. Furthermore, this essay will provide some examples to examine the relationship between core competencies and Icarus Paradox. Therefore, this essay will be divided into four parts. In the first part we will explain what the core competence is and why it is important for a company to be successful. Then, the second part will mainly concern the classification of key competences. Third, ways to identify core competency and the benefits of core competency will be discussed. Finally, the flaws of corecompetence and Miller's ideas on the Icarus paradox will be outlined. Furthermore, four paths that lead the company to decline will be highlighted. The definition of core competencies According to McGee, Thomas, and Wilson (2010), a core competency is a set of capabilities that different companies. Additionally, core competencies are based on how to make the perfect end product using the company's unique skills and resources. The main vision is collective learning, in particular how to apply production skills and technologies to the existing enterprise (Hamel and Prahalad, 1990). As a business, a core competency is important to produce a more competitive product. There is consensus that core competencies emphasize the integration of resources,...... half of paper...... published November 21, 2013].Forbes. 2013. “The Winning Strategy of Starbucks and McDonald's.” [online] Available at [Accessed 21 November 2013]. Prahalad, C.K. and Hamel, G., 1990. The company's core competence. London: Harvard Business Review, May-June 1990, pp.79–91. McGee, J., Thomas, H. and Wilson, D., 2010. Strategy: Analysis and Practice. 2nd ed. Berkshire: McGraw-Hill EducationMiller, D.,1992. “The Icarus Paradox: How Exceptional Companies Bring Their Own Downfall.” Business Horizons, vol. 35, number 1, pages 24-35Miller, D. and Peter, F.,1982. “Innovation in Conservative and Entrepreneurial Firms: Two Models of Strategic Momentum.” Strategic management. Diary. 3 (1) Tversky, A. and Kahneman, D. (1983) "Extensional versus intuitive reasoning: the conjunction fallacy in probability judgment", Psychological Review 90: 293-315.