Why adopt this practice?
Project stakeholders look for ways to understand and control project
funding, scope, risk exposure, value provided, and other aspects of the project.
While project iterations deliver product increments that show value
delivered and show progress at a fine-grained level (meaning that work items
are being addressed), they do not provide the necessary project oversight, transparency,
and steering mechanisms at a coarse-grained level that allow stakeholders to
make informed business decisions about the project.
The organization of iterations into a set of phases -- with a well-defined
milestone at the end of each phase -- provides the structure that stakeholders
and managers need to assess whether the objectives of the phase have been met
and whether the project should move on to the next phase or not. See Phase Milestones for more details.
By addressing the goals and risks of each phase, the team has the opportunity
to find the right balance between risk reduction and immediate value creation,
which are two major drivers for stakeholders. See Project Lifecycle for more information.