Milestone
Also called payment milestone, delivery milestone.
A checkpoint in a project where an agreed piece of work is delivered, checked and, often, paid for.
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What it is.
A milestone marks the end of a chunk of work with a result you can check: a signed-off prototype, a feature working in staging, a launch. In contracts, each milestone has a date, a list of what is included and acceptance criteria for signing it off.
Milestones are bigger than a sprint. A three-month build might have four or five, each made up of several sprints.
Why it matters
Milestones give both sides regular points to check progress and, if needed, change course. When payment is tied to them, the buyer pays for working results rather than time, and the supplier gets paid as value is delivered. They are a middle ground between fixed-price contract and time and materials.
In a product build
OceanLab's product builds and embedded engineers can be priced on outcomes, paid per milestone, or hourly at $30 to $50 an hour, whichever suits the client. Milestone billing needs each milestone written with its scope and checks.
Common mistakes.
- 01
Milestones that are activities ("backend work") instead of results you can test.
- 02
Putting most of the payment on the last milestone, which turns launch into a dispute.
- 03
No rule for what happens when a milestone slips because of the buyer, such as late feedback.
Work it out with a tool.
Related terms.
- Acceptance criteriaThe testable conditions a feature must meet before the person who asked for it accepts it as done.
- Statement of work (SOW)The document that sets out what a supplier will deliver, by when, for how much, and how the work will be accepted.
- Fixed-price contractA contract where the price for an agreed scope is set up front.
- Time and materials (T&M)A contract where you pay for the hours actually worked, at agreed rates.
Guides and pages
Browse the full glossary or read answers to common questions.
