Hierarchical inclusion is the concept that a number contains all of the previous numbers in the set. My son has Russian nesting dolls; Inside the largest doll are all the smaller dolls. Let's pretend that we call the largest doll number 6, and inside that doll are the smaller dolls, 5, 4,3, 2, 1(see image above). Students need to understand that you cannot have 4 objects without having 3 objects and so on. In other words, the whole has to contain the parts. See the video for a visual explanation.
How to Develop Hierarchical Inclusion
A good example on how develop hierarchical inclusion is the hand2mind video to the left.