The term “Following the herd” means that you just do the same thing everyone else is doing. Remember when we were in school and one of our friends would say “come on, everyone is doing it?” When I hear these words, I usually run the other way. I don’t like crowds and I don’t like following for the sake of following.
I have two daughters who are in their early 30’s and while I am very proud of how they life their life and the women that have become, I am especially proud that they are not followers. They are leaders. Even in school they both thought for themselves and did not do things just because everyone else was doing it.
In business, I have witnessed the herd mentality more times than I can count. Invariably when everyone starts wanting the same thing and chasing the same investment, it usually ends bad. More times than not, when you just follow the herd, you will end up in the same place as the herd. In the last cycle (08-09) I watched hundreds of hotel investors fail because they did what everyone else was doing and thought it would be ok.
I think of the oil/ fracking markets within the US. Three years ago, oil was at $105 a barrel and hotel companies were following the herd and building as many hotels in those markets as they could get the loans for. They all bought into the idea that the markets would last forever. In 2014 oil companies were buying used camping trailers in Georgia and shipping them to the oil markets and selling them for three times what they paid for them. They could not get enough housing for the oil workers and couldn’t build hotels fast enough. Well, the oil markets fell apart two years ago and most of those investors that followed the herd were impacted. Some lost their whole companies.
So, the point is that just because everyone else is doing it, doesn’t mean you should do it. Think for yourself and follow your own heart. While you may not be as popular as the herd, you will be making your own decisions and setting you own course in life. KT