While ram selection alone can yield significant improvement, selection of ewes will also accelerate progress.
The key step you should take before selecting ewes for breeding is to set your breeding objective. This provides the standard against which you will assess your ewes.
When selecting for a trait or characteristic, the most effective way is to directly measure or assess that characteristic. For example, you can estimate fibre diameter based on crimp frequency and handle, however, this is not very accurate compared to directly measuring a mid-side or pin-bone sample of fleece.
However, you must also weigh up the cost of individual testing of traits compared to visual estimates with the improvement in selection accuracy you will achieve.
Generally, it is cost-effective to measure the fibre diameter, fleece weight and liveweight of hoggets in wool flocks.
For prime lamb breeders (both Merino and other breeds), weigh potential ewe replacements as an aid to selection.
RFID tags will make this process much easier and accurate.
Note that a key element for selection is having plenty of ewes from which to select. This means that your flock needs to be achieving high reproductive success shown by high lambmarking and weaning rates.
For visual traits a subjective score should be used (e.g. wrinkle score as an indicator of flystrike susceptibility). A booklet on Visual Sheep Scores is available for download here.