The views expressed by (*5*) contributors are their very own.
There are many essential the reason why the concept of the “black sheep” exists, and one of them is that you must never follow the herd.
I used to be speaking with a valued client when the client made a valid point about the much-discussed inevitability of herd behavior. It was a valid point because herd behavior will all the time be a a part of our reality. However, the goal is to bear in mind enough of this syndrome that we will stay away from it at critical moments. One of the best ways to achieve this is to all the time have a balanced strategy in making financial and strategic commitments. To shed more light on the importance of getting a balanced awareness, let’s look at the story of a seasoned skilled and how his supposedly exceptional behavior became a weakness.
Understanding Herd Mentality and Maintaining a Sustainable Business Strategy
Herd mentality is present in every aspect of our every day activities as humans. But as an entrepreneur, you may’t afford to blindly follow trends or jump into saturated markets without a clear plan. You can argue that copying what has been proven to work by others is a sure and secure way to enter a market, but you’re also denying yourself the opportunity to innovate.
That said, this doesn’t mean you must throw caution to the wind and deliberately go against a common or popular idea. The trick is to maintain a balanced business strategy. Perhaps one of the best stories that teaches this moral is that of George Soros, an investor who made a name for himself by taking daring, dangerous actions against popular opinion. During the unforgettable bull market of 1987, he predicted an immediate decline in the Nikkei and a more sustained rise in the S&P 500; he positioned his stocks accordingly. Unfortunately, the opposite happened, and Soros’ daring stance against the herd became a disaster for his entire business operations.
Soros’ story provides an essential illustration for business leaders: an imbalance between judgment and strategy can lead to failure.
5 Reasons Why Entrepreneurs Shouldn’t Blindly Follow the Herd
1. Authenticity matters
The best danger of following the herd is that you just begin to lose touch with yourself and all the pieces that makes you unique. By conforming to the general expectations, your values, beliefs, and passions begin to take a back seat to your life and decisions. The truth stays that only by respecting your individuality are you able to achieve personal satisfaction and build true relationships.
Personal example: Being passionate about sports, I invested in a latest sports management business despite having limited experience in the sports industry. This experience had many ups and downs, and finally ended in success 10 years later.
2. Creative freedom
Herd mentality is one of the biggest barriers to creativity and innovation. It’s hard to come up with latest ideas when you are following the conventional path. But when you step away from the crowd, you may discover latest ideas.
Personal example: Against the advice of my financial advisor, I entered into a business partnership in the art industry. It turned out to be one of the best decisions I ever made, and one I might not have made had I stuck to conventional solutions.
3. Critical considering
Following trends or being a part of the herd deprives you of the opportunity to develop critical considering skills. By exploring your independence, you are able to sharpen your mind and make informed decisions after rigorously analyzing the situation you are in. In the future, you are able to make informed decisions that are aligned with your goals.
Personal example: I have been able to analyze and understand what is best for me. I now prioritize the well-being of my mind, body, and spirit, which is why I exploit practices equivalent to meditation and Qi Gong.
4. Personal development
Another good thing about stepping away from the herd is that you just change into more aware of your individual personal growth. Because you’re not doing what’s conventional, you’re forced to face your fears and test your limits. These experiences teach you the importance of being authentic even in the face of challenges and are key in shaping the sort of person and entrepreneur you change into.
5. A singular path to success
One of the truths you’ll have to come to terms with in a short time if you wish to achieve success is that there’s no one-size-matches-all definition of success; it’s different for every person. You have to cut through the noise and carve out something unique that aligns with your passion and strengths. Simply put, you have to define success on your individual terms.
The Way Forward for Entrepreneurs
- Risk management and diversification are the priority. Soros’ failure to manage risk led to his downfall. Always be strategic and never overcommit to one strategy.
- Work on your emotional intelligence. An emotionally intelligent business leader can understand when external aspects affect decision-making. This leads to more informed and rational decisions.
- Recognize that you just have cognitive biases and that they will distort your decision-making. A deep understanding of those potential biases might help reduce their impact.
- Implement and deploy adaptive strategies that enable you to adapt to a dynamic business environment.
Final Thoughts
The idea of breaking away from the herd is not only an abstract elitist principle, but a clever way to live a purposeful and authentic life. Doing what everyone else is doing is often a very comfortable and easy way to do something, but if it is not done strategically, this method can easily backfire. As a business leader and entrepreneur, you would like to bear in mind and analytical enough to know when an advantage can change into a drawback.
The only true path forward is to balance risk by being critical and flexible. And that is what separates exceptional leaders from the rest. They are able to step back to critically analyze and evolve based on the situation they are in. By adopting these traits, you are one step closer to your best achievements.