Offering promising career paths keeps high-performing employees around, so Lauren Cannon provides a spectrum of tips for internal promoting in an article for Inc. It all begins with recruitment, since these are the people who will be receiving promotions. Hire for not just skill but for general eagerness to learn, which is a key ingredient in succeeding after a promotion. When grooming people for promotions, carefully plot new responsibilities for them to take on, keeping in mind specific areas where they are likely to make errors or fail. Then adjust accordingly if those errors are indeed made. This will create a minimum of risk for the business and powerful learning opportunities for the ascending employee. It might even be a good idea to allow employees to tag along with you to your meetings with higher-level people, for the learning experience it might provide. And in general, if employees ask for more responsibility, they should receive it. A willingness to grow should always be encouraged. Greater employee loyalty and confidence will result from such actions.
You can view the full article, with big and small examples, here: http://www.inc.com/guides/2010/12/how-to-promote-from-within.html