Drawn from the mass suicide of 914 followers of cult leader Jim Jones in 1978 by drinking Flavor-Aid laced with cyanide (known as the "Jonestown Massacre"). Someone who "Drank the Kool-Aid" has so bought into their leader's vision or cause they will blindly follow to their own doom.
Other companies adapted and were successful. However, James continued to believe his bosses were right not to adapt--even after the company had to file for bankruptcy. James really "drank the Kool-Aid".