Promoting from within builds culture. It doesn’t build leaders on its own.

Nobody told him how hard it would be.

When Joe got his first big promotion to executive VP, he didn’t get a coach. He hadn’t been through a leadership development program. His CEO just hoped he would figure it out on his own.

Like most high performers, Joe eventually did. But he told me this week, “The first couple of years were a rocky road. I am lucky they stuck with me for that long, but I definitely wouldn’t have wanted to be on my team at the beginning, because they didn’t get highly effective leadership.”

What struck me is that Joe wasn’t telling the story to be dramatic. He is now on the other side of the table, deciding who to promote into key leadership roles, and he is wrestling with whether to promote from within or hire someone from outside.

His last few promotions came from within, which helps culture and retention. But broadly speaking, the people he has promoted are not making the leadership leap once they reach the next level. The most common reason is simple:

The skills that earned the title are not the skills that carry the title.

Joe’s Story Is Not Unusual

Some leaders are built for the leap. They have been mentored and coached, and they were given chances to rise to the occasion. They still make mistakes and learn hard lessons, but they are the exception.

The data points the same way. In Russell Reynolds’ research, only 25% of next-generation C-suite leaders said their company has a successful succession strategy. A separate i4cp study found that only 40% of organizations are effective at building bench strength for critical roles.

It turns out most organizations focus on promoting talent instead of preparing it. They ask who will step in, and they skip how that person will step in. Both questions matter.

What to Look for in People to Promote

Many traits matter in a leader. To improve your odds of picking someone who makes the leap successfully, I would boil it down to four C’s, when helping organizations with succession planning.

• Character: Will they do the right thing when no one is looking, or when it gets really hard? A strong performer with weak character does not just fail at the leap. They take the team down with them. Watch how a person handles credit and blame.
• Competence: The leaders who make the leap build competence that commands respect. They are obsessed with learning and improving, and they seek out what they need to learn without waiting to be told. They don’t have to be the smartest person in the room. But if you don’t think your boss knows what they are doing, how confident can you be in their direction?
• Challenge: The secret trait is someone who loves challenging the status quo and does not settle for current results. They hold high standards, and they see a brighter future than the one that exists today.
• Care: In Building the Best and Accelerate Leadership, I defined leadership as “Someone whose actions elevate others.” If even your highest performer lacks a heart for people, their promotion will set your organization back instead of setting it up.

How to Prepare Leaders For Their Promotion

Finding the right people is half the work. The other half is preparing them before the promotion instead of after it. A high performer with the four C’s still has water to cross, and four stones get them across. Each leadership development program can be different, but here are some common approaches we use to power a company’s leadership development program.

1. Formal learning: Teach the skills of leading people, because no one is born knowing them. This can be in person or virtual.
2. Feedback: Give them an honest read on where they stand, from the people they work with, before the title arrives. A leadership 360 can be a great way to get them the truth.
3. Opportunities: Hand them real projects that stretch them while the stakes are still manageable.
4. Group coaching: Put them in a room with other emerging leaders, where they learn from each other and not just from you.

Preparing talent is what turns a great performer into a great leader.

So the only question isn’t whether to promote from within or hire from outside. It’s probably some combination of both. But if you’re going to promote from within, know what you are looking for and how you are going to prepare them.

P.S. Take the free leadership style quiz here to see which of the five styles you are leading like today.

This column originated from The Leadership Lens. Join 16,374 leaders who get it every Thursday.

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About the Author: John Eades is the CEO of LearnLoft and The Sales Infrastructure. He was named one of LinkedIn’s Top Voices. John is also the author of Building the Best and the Optimistic Outlook.