Essential Components of an Internal Promotion Policy

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To be effective, an internal promotion policy should do the following:

Unequivocally state the organization’s commitment to promoting employees

from within whenever possible and whenever they are qualified

to meet the work requirements of new positions. (But it is best to cap

promotions at 80 percent to avoid too much inbreeding.)

Exhibit 10-3. Talent Shows: What Happens?

At Eli Lilly, the direct managers of high-potential individuals participate in intensive

assessment discussions with other executives concerning the individual’s strengths,

development needs, and career potential. The individual’s manager then provides

her with the key points of feedback from the assessment discussion. Afterward, the

individual works with the manager to develop a personal career plan that reflects

her perceived career potential and also factors in her career interests and goals.

The career plan is reviewed by the manager and individual and is updated when

needed or, at a minimum, on an annual basis.

The amount of time that executives in many companies are devoting to succession

planning is a clear reflection of the increased priority placed on developing top

talent. At Dow Chemical, the Human Resource Council—a small group that includes

the CEO and a handful of his key staff members—spends five days each year

off-site on succession planning: talking about candidates, reviewing development

plans, and directing development assignments. At Corning, executives in each

major unit spend one to four days per year in people reviews that extend down well

below the managerial level. The involvement of senior executives is often expressed

in very personal ways. In a number of companies, CEOs, such as former General

Electric’s Jack Welch, review job assignments and compensation recommendations

for several hundred managers.

Source: John Beeson, ‘‘Succession Planning,’’ Across the Board 37:2 (2000), 39. Used by permission.

Define internal promotion.

Explain the business reasons for that policy.

Explain the legitimate conditions under which that policy can be waived

and an external candidate can be selected.

Since an internal promotion policy will (naturally) build employee expectations

that most promotions will be made from within, decision-makers should

anticipate challenges—legal and otherwise—to every promotion decision that

is made. For that reason, the policy should be reviewed by HR professionals,

operating managers, and legal professionals before it is implemented or

widely communicated. In any case, reviewing the policy before adoption is

more likely to build consistent understanding and ownership of it.

When Are Internal Promotions Appropriate or Inappropriate?

Internal promotion is appropriate to meet a vacancy in a key position when a

qualified replacement from the organization is:

Ready to assume the duties of the key position by demonstrated mastery

of at least 80 percent of the position requirements and progress

toward meeting or exceeding the remaining 20 percent of the position

requirements.

Willing to accept the position, expressing a desire to do the work.

Able to accept the position by having his or her own replacement prepared

in a reasonably short time span and by being ready to assume the

duties of a key position.

But promotion from within is not appropriate for meeting SP&M needs

when any of these conditions cannot be met. Alternatives to internal promotions

are thus appropriate when a qualified internal candidate cannot be found

after a reasonable search, when possible candidates refuse to accept a position,

or when possible candidates cannot be freed up from their present duties

in a reasonable time.