Succession planning is important for any job in any company, but is especially critical for high-level executive positions. Former GE chief Jack Welch was the king of this link to, and his groundwork in readying three of his talented GE underlings to compete for his CEO job when he stepped down is a business-school example of how great succession planning should work.

You may remember the three—Jeffrey Immelt, James McNerney and Robert Nardelli. Immelt won the competition and succeeded Welch as CEO of GE, but even the two who “lost” the race really won in the end. Nardelli was quickly snapped up to run Home Depot (he has since moved on to become CEO of Chrysler), and McNerney was hired as CEO of 3M before getting recruited again to run Boeing.

Welch takes a lot of pride in the fact that three of his top lieutenants at GE are running Fortune 500 companies, but more important, he sees the departures of Nardelli and McNerney from GE to be a good thing for all involved. And as a USA Today story this week shows, “Some companies cheer when alumni move on and up.” In other words, top-flight executives understand, and take pride in, the accomplishments of their subordinates—even if those accomplishments take place somewhere else.

It’s this “parental pride” in succession planning that separates top-notch, forward-thinking leaders from the petty, small-minded people who seem to be threatened by the potential success of those below them. And it’s this parental pride in seeing someone you have guided succeed and prosper that really makes a succession planning system work.

In my career, I’ve seen it both ways. I have had great mentors who seemed genuinely happy when I left them and went on to bigger and better things, but I have also had people I worked for who seemed to resent my growth and success.

One guy in particular—a man I worked for longer than I have for anyone else—had a number of subordinates move along to great jobs running their own operations. Unfortunately, my former boss was one of those petty and small-minded types who couldn’t take pride in anyone else’s success. Just about everyone who left his employ, including me, marveled at his ability to mentor and grow talent without an ounce of pride in anyone else’s accomplishments except his own.

As the USA Today story rightly points out, “When talented executives jump ship to become CEOs elsewhere, [great companies] don’t mourn the brain drain. They revel in it.”

If you are doing your succession planning right, you should be reveling in it too.