PGMP · Question #2
You are a program manager for your organization. You have proposed a program to the management that will last four years and will cost $35 million to create. Management has asked to see the program…
The correct answer is B. Step funding. Step funding (also called incremental funding) is when an organization releases funds in stages tied to the achievement of specific milestones or phases rather than releasing the entire budget upfront. This approach reduces financial risk for the organization-if a milestone is…
Question
You are a program manager for your organization. You have proposed a program to the management that will last four years and will cost $35 million to create. Management has asked to see the program charter and the proposed costs and benefits of the program. Management agrees to your program charter and proposed to fund the program in increments at the completion of each milestone. What type of funding does management proposed for this program?
Options
- ATentative
- BStep funding
- CMilestone approval
- DPhase gate estimating
How the community answered
(19 responses)- A5% (1)
- B89% (17)
- D5% (1)
Explanation
Step funding (also called incremental funding) is when an organization releases funds in stages tied to the achievement of specific milestones or phases rather than releasing the entire budget upfront. This approach reduces financial risk for the organization-if a milestone is not met, funding for the next phase can be withheld. It is distinct from 'phase gate' (which is a decision review point, not a funding model) and 'tentative' (which implies uncertainty rather than a structured release schedule). Step funding aligns sponsor investment with demonstrated program progress.
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