359. The Pattern You Can't See (That Everyone Else Can)
You’re secretly running two parallel systems, and the pattern you can't see is the one killing your company.
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Over 90% of leaders say they don’t pick favorites.
Turns out 60% of their employees disagree.
Favoritism is real. We all know it.
In fact, I bet there’s a scenario going through your mind right now, right? There’s definitely one going through mine.
What gets me all rankled up is when that favorite person isn’t even competent.
They’re the ones who miss deadlines and the boss ignores it.
They show up late and somehow it’s fine.
They make the same damn idiotic mistake three times in two weeks without a single talking-to while I get called out for making one small error even though that error is meaningless and nobody would’ve noticed if everybody just shut their mouths.
Speaking for a friend, of course.
Uhhmmm… anyway.
Favoritism can be incredibly frustrating.
But you know what?
Favoritism isn’t the problem.
The problem is that you’re running two parallel operating systems and you don’t even realize it.
A Company’s Two Operating Systems
Every organization runs on two opposing systems:
The Official System
Your company values, performance metrics, review process and all those other standards you claim to hold everyone to.
The Shadow System
This is the system that defines who actually gets held accountable to the Official System and who doesn’t.
The gap between those two systems is the cold dark alley where your culture goes to die.
90% of leaders don’t realize they’re running both systems. Which most likely means you are too, and you don’t even notice it.
The Way The Shadow System Plays Out
I constantly see the Shadow System in my leadership coaching business. In fact, just recently I was called in to help a $40M business unit of a F500 that had the same problem. Here’s what it looked like:
Clarke ran the business.
Carrie ran operations.
Clarke thought Carrie had become “so difficult to work with” over the last few months. She used to be collaborative - now she pushed back on everything, and he couldn’t figure out why.
Whenever he asked her about it, the response was always, “I’m fine.”
But she wasn’t.
After just one conversation with each of them, I realized what was happening.
You see, when Clarke got hired, he brought two guys with him from his old company. They were senior leaders by title and salary. Not so much by skillset.
Over the years they’d become Clarke’s friends and confidantes.
They were his favorites.
When either of them showed up late or didn’t show up at all, Clarke let it slide.
But when Carrie clocked out early on Friday, after a 60-hour week, her commitment was questioned.
When the two guys missed a deadline because they went to a basketball game with Clarke the night before, they were forgiven.
But when Carrie’s deliverable was delayed by three days because she was juggling too much, she was belittled.
Same test. Different grading.
The final straw for Carrie was when she realized that they were both making the same salary as her.
Whaaaat?!
HR originally called me because they were worried about misogynistic behavior.
But it wasn’t misogyny.
It was the Shadow System.
And if I hadn’t helped them see it, they would’ve lost Carrie - and she was by far the best employee the company had.
That’s how the pattern plays out.
When employees perceive favoritism:
Engagement drops by 40%
Retention drops by 50%
Trust in leadership jumps off a very high cliff and plummets to its death.
Remember how I talked about that alley where your company culture goes to die? This is it.
Rising Resentment
Here’s what actually happens when the Shadow System kicks in.
First, employees resent the favored person.
They gossip about the preferential treatment and they whisper bad things behind their back while being fake-nice to their face.
But soon the resentment shifts.
Because the favored employee isn’t really the problem. They’re just operating within the system that was built to favor them.
The real problem is the leader running that Shadow System.
So employees begin to resent the leader. Even the top performers start treating the leader differently.
They’re quieter in meetings.
They’re less engaged.
They’re not as creative or motivated as they used to be.
You can feel something’s off but you can’t quite name it.
Maybe they’re having trouble at home?
Maybe their relationship is struggling?
You rarely even consider that there’s another problem. A closer problem.
So let me be direct:
It’s you.
You’re the problem.
It’s you.
The Blind Spot
Nobody’s going to tell you you’re being unfair.
After all, the people benefiting from the Shadow System don’t see the problem. Even if they did, why would they reveal it?
And those people getting screwed by it? They’re too scared of being viewed as “needy” or a “complainer”. Besides, they already know that you’ll favor your friends over them anyway. So what’s the point in speaking up?
Meanwhile, you genuinely believe you’re being fair. You’d be shocked to hear anything different.
But you do have favorites.
And everyone knows it except you.
Unfortunately, you can’t learn from a pattern that you can’t see.
(FYI, I talk about this same issue in Why Leaders Repeat The Same Mistakes)
How To Spot Your Own Shadow System
Like all patterns in your blindspot, once you see the symptoms, you can assume the behavior exists.
Here are 5 symptoms of Shadow Systems to watch out for:
Symptom 1: Vanishing Feedback
Your top performers used to push back and raise concerns. Now they just nod and do the work.
Symptom 2: Personality Conflict
Suddenly everyone has a “personality conflict” with the employee closest to you. Weird, right?
Symptom 3: The Whisper Network
When people stop talking to you and start talking about you, you’ve lost control of the control room.
Symptom 4: The A-List Exodus
If your top people keep “finding a better opportunity”, while your mediocre people stay, you need to switch operating systems. What’s that sound I hear? Oh yeah, it’s the warning bells of cultural demise.
Symptom 5: “Not My Problem” Problem
People who used to be passionate and self-sufficient now cc: you on everything and get your written approval before moving forward. They’re not suddenly being thorough, they’re building evidence for their exit interview.
The First Step Is Awareness
I’ve got bad news for you: the Shadow System isn’t something you fix with a checklist. It’s something you become aware of and stay conscious of.
You should start by assuming the Shadow System exists. Because it probably does. The question isn’t whether you have favorites - it’s whether you know who they are and why.
Then watch for the symptoms.
When your top people start acting differently, don’t assume it’s them. You’re better believing that it could be you and your Shadow Operating System.
Maybe it’s time you stepped out of the shadow.
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Whats your favorite favoritism story? Drop it in the comments.
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If you liked this article, join me on Substack Live this Thursday, Feb 19, where we’ll talk more about the Shadow System.
If this article resonates with you, I run a diagnostic workshop that helps you uncover the patterns holding you back.
Join the waitlist for a chance to get a seat at the next one.
Really powerful insights and very relatable both in large and small companies. Thanks for the article!
The Shadow System vs. Official System explanation is a good one! Most leaders genuinely believe they're being fair while everyone else is watching the double standard play out in real time. The Carrie story is relatable because it's so common, and the symptoms checklist is the kind of wake-up call most leaders need but won't listen to.
My favorite favoritism story is a little different. I had a client who kept reassigning high-visibility projects to himself at the last minute because "only he could present them properly to the board." The team would do all the work, he'd swoop in, take the deck, and deliver it without crediting anyone. He genuinely believed he was protecting the team from pressure, but what he was really doing was protecting his own reputation while making sure no one else got a shot at advancement. His best PM quit within six months.