When a role at your company becomes available that is higher level and higher paying, you will gain an advantage by hiring an existing employee. It will display to your employees that you have a respect for their workplace contributions, and that you value their commitment to building the company. You will also be sure that the person filling the role will already understand your company philosophy and values. Tactically, it will also save you on training as you will not need to spend resources on the basic training of the company and can focus on training the individual for their new role.
The employee that you choose to promote for the new role should be proven as the best candidate for the position. Because the promotion will require a higher level of responsibility, you must be sure that the selected employee is ready for and can handle the role. The employee should already be showing the necessary skills for the role, or if not if they have an aptitude for acquiring the skills or have shown an interest. Some other questions you may want to ask yourself is if the employee has an expansive view of the company and can see past their own personal role or department. You will want to select leaders that can help drive the vision of the company forward.
You also must ultimately leave the decision to promote an employee up to them to accept. They may not be interested in the role because it requires travel, or more time spend doing tasks that they have no interest in. Be sure to promote those within your company who want to be promoted.