A promotion is one of the easiest ways to reward an employee who’s performing well. But a promotion can also be tricky to navigate. How can you determine if an employee is worthy, ready and able to handle a new or expanded role?

Make it work for everyone

While a promotion benefits one employee directly, it also reinforces to the rest of your staff the traits you expect good employees to embody. Does your business value ruthless lead generators? Mentors? Team players? Consider this carefully and promote employees that reflect what your company stands for.

Make sure they want a promotion

You may think your best server, Cindy, would make a great manager, but she may be content with the way things are. It’s difficult to say what motivates employees to aspire or stay put, but open communication can help you find out. Periodic reviews can pave the way to better understanding and promotions that work out in the long run.

Consider more than your perspective

You’re the boss, which means that for the most part, employees will be on their best behavior in your presence. To really understand if an employee is performing well enough to merit a promotion, get the opinions of peers, vendors and customers. The truth will emerge soon enough.

Create a trial period

Perhaps you think someone is ready for a promotion, but you’re not quite sure. Instead of going all in, test it out with a stretch assignment – a task or project that reflects what the new role might entail. For the employee, it’s a taste of what lies ahead, and for you, it’s a glimpse of the employee’s potential. If the stretch assignment goes well, you can promote with confidence. If it doesn’t, you’ll learn what skills your employee needs to develop to succeed at a higher level.

Consider more than money

If tight budgets are preventing you from giving a promotion, remember that not all employees are motivated by money to excel. A better title, more recognition in your company or industry or access to perks are just some things you can offer in lieu of cash incentives. Plus, the money can always catch up when budgets permit.

Keep an eye on the achievers

Employees who quickly master existing challenges and consistently seek new ones are likely to become bored when the challenges run out. Be proactive with your achievers by creating a promotional path to success. While it may require some additional planning, it can help you keep a high-performing employee from going to a competitor.

Which employee you promote is up to you. By following these guidelines, you can increase your chances of promoting whomever you choose successfully.