When you add a word to the dictionary what happens to it?

I don't understand the question very well. You, or any average person, does not add anything to a dictionary. Dictionaries are compiled by researchers and editors. They decide if a word and/or a particular meaning or usage of a word, is worth inclusion in the dictionary. Historically, dictionaries were produced by individuals, and later dictionaries built upon the earlier works, so what we have now are a mixture of historically documented meanings, spellings, and usages, along with additions. The additions are decided by teams of "experts", who tend to be people who spend their entire life studying word meanings and usage.

This is why there are differences between dictionaries and why some dictionaries are considered better than others. Different quality of "experts".

If you meant when you add a word to your spell check in MS Word or something, that just gets put into a file that is called your personal dictionary. No one vets it, no one sees it, no one judges it. It is just a file on your computer. Has no value except the value you assign it.

Of course, you could add your own word and meaning to an open forum like Urban Dictionary. Doesn't mean that most people will accept that meaning or use.

Every so often - i.e. not regularly - a committee studies all the new words that have come into being over the past few months or years. It is up to the committee to decide what new word will be added to a dictionary.