I think most of the Genins have already proven themselves worthy of being a Genin in terms of skills and powers, for eg. Neji who has been called the Genius of the Hyuga clan and Rock Lee who's able to open 5 of the 8 gates. But although their powers have surpassed those of a regular Chunin, most of them failed the Chunin exams except for Shikamaru, who although was defeated managed to get promoted due to his talent in tactics and planning.
Thus, it is safe to assume that promotions do not come based on only skill and power factor.
Eg. Back in the Chunin exams, if Naruto were to go against a Chunin, maybe Iruka, who do u think will win?
Question then: Do all ninjas need to clear the exams before he can be promoted to the next rank? Or do they get automatic promotions based on powers/seniority/other attributes?