I'm sure this question has been addressed in the educational literature to which I do not currently have electronic access.
The question for the day is whether a department that has, say, a 10-year record of awarding tenure to every faculty member who has come up for evaluation is one that has standards that are too low.
One might argue that such an outcome would be the result of outstanding and prescient recruiting of new faculty. Alternatively, superb resources and an enriching collaborative environment might promote such a culture of success.
Another reason might be that underperforming faculty members are counseled early, perhaps at their mid-review, that tenure is unlikely. Those faculty then either choose to go to a non-tenure track teaching position or seek work elsewhere.
So, would a 100% tenure-award rate always mean that a department's evaluation standards were substandard?
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On its own, that rate doesn't really tell you much except that something unusual is going on--either really good or really bad. If other measures of the department's academic quality remain high (all faculty are publishing, obtaining research money, whatever) than I'd want to study what they're doing to try to emulate it. Their hiring filter might be particularly good, they might have really good mentoring for junior faculty, etc.
If, however, other measures of "quality" are low or have decreased sharply in recent history, that probably means that something is wrong. But the tenure rate on its own only means that something is different.
Might the industry segment be important too? What rates do the most-relevant and specific competitors exhibit?
Hopefully a commenter will dredge up the broad tenure-denial stats- do I recall something well below 10% across all US institutions?
Maybe the most important number isn't the "10 year" number, which sounds like a lot, but the number of faculty that went up for tenure in that time frame. While 10 years is a good length of time, in most departments the turn-over/growth will only lead to a few hires and thus a few promotions. I think if a department has 5 faculty go up for tenure in that time frame, that would be a huge number. For example, if a faculty member is hired and unsuccessfully goes up for tenure, the replacement hire would be at most in year 2 of their tenure clock in a 10 year period. So a department having a 100% success rate shouldn't be too surprising. Maybe a better assessment would be "of the last 10 tenure decisions in a department, what was the success rate?"
There is no way to interpret a tenure rate without knowing the hiring practices of the department. Some departments/institutions intentionally hire multiple entry-level tenure-track faculty for each tenured "slot" that will be ultimately be available. This creates a competition for those tenured slots. Other departments/institutions intentionally hire the number of entry-level tenure-track faculty that they expect to become available as tenured slots in the future. If the latter do a good job of selecting entry-level faculty in the first place, there is no reason they couldn't have a 100% tenure rate.
This may be the result of a very restrictive review of who is placed in consideration for tenure. The respondent who asked how many years a faculty member is at rank before being put up for tenure is on the same track - no pun intended.
I'd say it depends on the particular circumstances. The department I work in has generally been rated in/near the top 10 in the U.S., and when the chair hired me he boasted that 90% of his hires had successfully achieved tenure.
No, a 100% tenure rate over ten years doesn't mean an department has low standards. (How many departments have multiple hires within ten years? Only very large ones, in fields that are rapidly growing, I suspect. My graduate department went more than ten years without hiring a single person at the assistant professor level - all its hires were people stolen from tenured positions at other institutions. And the departments in which I've worked have had six people total - not enough to do statistics, even if the entire department turned over in ten years.)
The question shouldn't be about tenure rate. The question should be whether the people who get tenure are productive (in whatever way is important to the particular institution - one can become teaching deadwood as well as research deadwood).
Kim has a good point that beyond the main question: what percentage of faculty become "deadwood" in either teaching, research, or both?
PhysioProf describes the situation at many universities formerly referred to as "Research I." It was and still is common practice to leverage departmental appointments to hire, say, three faculty members to compete for only one tenure slot. Brutal, but true.
I like the better framing of my question by Lorax: what is the success rate of the last 10 faculty members put up for tenure. I feel that it is the responsibility of the chair and members of the P&T committee at the interim evaluation and thereafter to counsel faculty and not put up those unlikely to be awarded tenure. Some of these individuals might be better off elsewhere but some may be valuable to the department or institution in other positions outside of the tenure-track. I had a tremendously successful teaching colleague whose research wasn't quite cutting it decide not to go up for tenure and assume a year-to-year academic asst dean position. He remains tremendously successful at that as well.
While on the topic, let's not forget to plug colleague DrugMonkey's post on life after being denied tenure. Some do indeed say that it was the best thing that ever happened to them.