The Hidden Hierarchy

What your organization is teaching people to become

You have probably written the values down, or inherited them from someone who did. Integrity. People first. Honesty. And if you are honest, you have probably watched your organization, your team, fall short of those words, and wondered why the poster never turned into the place. You are not failing at communication. You are running into something deeper, and it is shaping your people whether you pay attention to it or not.

The two cultures every company runs

Every company actually runs two cultures at once. There is the one you wrote on the wall, and there is the one your people learn by watching. To see how the two come apart, start with a well-documented quirk in how people size each other up. We rate our own values as better than everyone else's, and we assume other people are a little more selfish than we are. Researchers call it the illusion of moral superiority. So your people are probably better than anyone gives them credit for, including you. You just cannot see it from the outside. You see what people do, and what people do is where the trouble starts.

Because what your people value and what they think is rewarded are not always the same. When the two pull apart, people tend to follow the reward, reasonably, the way anyone would who wants to keep their job and get ahead. They adapt. The catch is that no one can see the adaptation from the outside, only the result. Picture someone on your team who makes sure leadership hears about every win he lands. A colleague watches that and files him as a self-promoter, never seeing that he hates doing it and only started after watching a more talented peer who kept his head down get passed over twice. He adapted. The colleague reads the adaptation as his character, and adjusts to the world that character seems to prove, and starts promoting a little harder too. Now two people who both privately dislike the game are teaching each other to play it, and neither one chose it. Multiply that across your whole organization and you understand why good people build cultures they complain about. Nobody decided it. Everybody is responding to a picture of everyone else that is mostly a misreading.

How culture forms out of misreading

There is a name for the sharpest version of this, and you have almost certainly caused a small piece of it without meaning to. Psychologists call it pluralistic ignorance, when most people privately hold one view while assuming everyone else holds another, so they all conform to a norm almost none of them actually wants. Consider after-hours email. You answer messages at night, not because you expect anyone to match you, but because that is when you finally have room to think. A director sees one at ten and replies instantly, assuming that is the expectation. His team sees him do it and starts doing it too. You notice how responsive everyone is and conclude the culture is fine with it. No policy was ever written. No one particularly wanted the policy. It exists now anyway, built out of people being considerate toward a norm that was never really there. And if you traced it back, it started with a habit of yours you never meant as a signal.

This is the thing to get about the place you lead. It is not just a business that makes things. It is a place that forms people. Your people spend the long hours of their adult lives inside it, and it teaches them constantly, through who rises and whose mistakes are survivable and whether telling a hard truth turns out to be wise or foolish. Long before anyone could describe your culture, they have learned what kind of person does well in it, and they have already begun to become that person.

And it does not stop at behavior, which is the part that should give any leader pause. What people practice starts to practice them. A manager avoids saying what she really thinks in the room because she is still learning the politics, and five years on she has simply become someone who does not say what she thinks. A salesperson rounds the truth up because everyone does and the commission depends on it, until the rounding stops feeling like rounding and starts feeling like the job. What begins as a strategy for surviving your environment eventually becomes a person's character, and it outlasts the environment that produced it. Ten years inside your organization is never neutral. The organization gets inside the people.

The hidden hierarchy: what wins when values collide

So here is the hidden hierarchy, the one that actually governs the place. You have a stated set of values, and they are almost certainly fine. Nobody puts the opposite on a wall. But underneath the stated values runs a real one, and it only becomes visible when two good things collide, and one of them has to give. When revenue and honesty finally meet, which one wins in your company? When a top performer behaves in a way that would end anyone else's career, does the result buy him a pass? You answer these questions all the time, not in your values statement but in your decisions, and the answers pile up into the truest definition of culture I know. Culture is accumulated precedent about what wins when values compete. And you are the one setting most of that precedent, in public, whether you frame it that way or not.

Run the real culture audit

Which means the honest way to read your own culture is not to ask yourself what you value. Ask what a sharp, observant new hire would conclude she has to become to succeed under you, after watching closely for a year. Then answer it with evidence instead of intentions. Look at who you actually promoted and what those people genuinely have in common, not what the framework says they should. Notice what happens to bad news on your watch, and whether the person who brings it early is thanked or made to pay for it. Watch whose behavior you forgave because the numbers were good, because that exception taught your people more than any all-hands ever will. Pay attention to what your people hide, which maps what they have learned is dangerous, and to what they exaggerate, which maps what they have learned is rewarded. That inventory is your real culture, and it will not always match the wall. Where it doesn't, you have just found your actual work.

Leadership is environmental design

This is why part of your job is shaping the environment, not just running it. You are responsible for strategy and survival, obviously, but every real decision you make also teaches, far past its immediate purpose. A promotion teaches. A violation you let slide teaches. The way you take bad news teaches. Your people do not learn what you value from what you announce. They learn it from what costs something, because anyone can honor a value while it is cheap, and the real hierarchy only shows itself when keeping one good means paying with another. If honesty genuinely matters to you, truth-telling has to stay safe even when the truth is expensive to hear. If you say family matters, your people cannot keep watching the ones who sacrifice their families rise the fastest and still believe you.

Rightly ordered loves

There is a point where this stops being a management question and becomes something older, and I think it is worth naming plainly even in a business setting. The research can tell you a great deal about motivation and trust and how norms form. It cannot tell you which goods deserve to sit above which. Efficiency can be measured, but whether efficiency should be bought at the cost of someone's dignity cannot. Profit can be measured, but profit cannot tell you what the profit is for. For that you need a moral language, and one of the most useful I know comes from Augustine, who described the good life as a matter of rightly ordered loves. Money can be loved well and in its place. So can achievement, recognition, growth. The disorder begins when a lesser good gets treated as the highest one, when profit outranks people, or harmony outranks honesty, or looking strong outranks telling the truth. Your organization almost certainly does not love bad things. It loves good things in the wrong order, and then teaches everyone inside it to love them in that same order.

That is the real weight you carry. Your organization is not only a place where people make things. It is a place where things are made in people. Give a decent person ten years inside a badly ordered environment, and it can teach him to normalize what he once would have refused, and it will not take any dramatic corruption, just the daily pressure of what seems to work. And the reverse is just as available to you. A rightly ordered place makes courage a little easier, because courage is not punished, and honesty a little easier, because the truth is not dangerous, and ownership a little easier, because a mistake can be admitted without ending a career. You cannot manufacture virtue in people. But you can make it cost them less, and that is a great deal of what leadership actually is.

So the question I would leave you with is not whether your values are correct, because they almost certainly are, at least on paper. It is what kind of person someone becomes by succeeding under you. More guarded, more political, more performative, more afraid to admit what they do not know. Or more truthful, more responsible, more willing to act for the good of something larger than themselves. You are answering that question every day, in every decision your people are watching. And if one of them gives a decade of his one life to your organization, the honest measure of your leadership is the kind of person it hands back to his family at the end of it.

Leadership starts to grow up at the moment you decide that accidental formation is no longer good enough.

If you want help reading the culture you are actually building, book a discovery call.

About the author

Eddie Eccker, MS, LMFT, is a licensed marriage and family therapist with roughly twenty thousand hours of clinical work and the founder of Voyages Counseling in Colorado. He is the author of a three-book series on how people are formed, including You Are Not Finished, and he works with leadership teams on culture, trust, and honest feedback. More at eddieeccker.com.

Notes

• The illusion of moral superiority, our tendency to rate ourselves as more moral than others: Tappin, B. M., and McKay, R. T. (2017), "The Illusion of Moral Superiority," Social Psychological and Personality Science. journals.sagepub.com · plain-language summary at the British Psychological Society.

• Pluralistic ignorance: Prentice, D. A., and Miller, D. T. (1993), "Pluralistic Ignorance and Alcohol Use on Campus," Journal of Personality and Social Psychology.

• The idea of rightly ordered loves (ordo amoris) comes from Augustine.