They come with it, but it's not very refined without training. They actually need a lot of training to not herd people, especially children. Since humans don't respond the same way as sheep the dog will keep escalating its herding behavior until it bites the human.

I heard an anecdote once of a couple that was camping in a dispersed area with their border collie and the dog ran away. They called and searched and were basically resigned to the loss of their dog, when at dusk they heard a huge commotion. Suddenly their dog drove an entire herd of elk through the campsite.

I had a black/white Australian shepherd I met at around 4weeks of age, took him home soon as I knew he didn't still feed from the mother. He would heard children without being taught. 4 kids under 10 on the backyard playing and 1 tries to go to the front he would run around the front of them and cut them off, he never nipped anyone, just knew it was safer to keep all the younglings together.

Later when I got chickens, he did the same. (I never taught him whistle commands or anything because it's not like I had cows or anything, he just came pre-programmed)

The herding is instinctive, doing it in any sort of directed manner needs training. Among the things my collies have tried to herd are people, other dogs, birds, trees, and a pond. Maybe the fish that were in the pond. She seemed to be having fun either way.

Look up Sean the sheepman on YouTube. He has a good series on training some new dogs. They have the drive to do it inately. But need to learn how to do it effectively, not just run straight into the middle of a pack. They also have to learn the handlers commands so they can drive the sheep somewhere useful

I think every working dog needs training but a certain amount is in their genes

Its like they have the predisposition to do it, but almost dont know why. I have two corgis and they are the smartest dogs. They will try to move people and other animals around to their liking though. If my two kids start fighting or anything like that, they will attempt to stop it. Its kinda neat.

I had an Australian Shepherd/Black Lab mix growing up and he would nip at my fingers to get me to go where he wanted. Didn't need a leash on walks, he'd just herd us along.

My aunt and uncle said when you have your third kid, you switch from man-on-man to zone defense.

Found this, mostly because I didn't think it was real, but now I know.

https://www.youtube.com/watch?v=w5iwlAgEKbE