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Agile methodologies are ubiquitous in software development, emphasizing flexibility and responsiveness to change. One core principle of the agile framework is accurate estimation, which allows teams to plan effectively and deliver value iteratively. Therefore, a tool that can be used to achieve accurate estimations is story points.

This article explores the concept of story points and how they can be leveraged for effective estimation in agile projects. It will also cover how to calculate story points in an agile framework, and the best practices for utilizing story points.

What Are Story Points?

Story Points are a way of estimating the time it will take to finish a particular task. It does this by assigning a value to a task. However, this value is not assigned to a task based on the time it takes to complete, but the effort it requires. In this way, story points can capture factors such as complexity, size, and inherent uncertainty, rather than solely focusing on time.

An important thing to keep in mind is that story points are often relative. They are not meant to be used as is everywhere. Each organization will assign their story points differently.

There are several benefits for using story points:

Quick Estimates: Story points act as a relative measure of effort for tasks, based on the complexity of similar completed tasks. This allows for quick and efficient estimation during planning sessions.
Accuracy: Story points are by no means foolproof, but they are accurate enough to plan future sprints and manage expectations.
Emphasis On Effort: Story points decouple estimates from time constraints, bringing a team-centric approach where effort is the primary consideration. This enables better planning and facilitates adjustments as needed.
Accounting For Uncertainty: Agile projects are inherently fluid, meaning that the time taken for tasks is often unknown. Story points capture the associated uncertainties and risks, allowing for more realistic estimates.
Improved Team Collaboration: The process of estimating story points promotes discussion and collaboration within the team. This shared understanding leads to better planning and risk identification.

Story Points Vs. Time-based Estimation

Traditional project management often relies on estimating tasks in hours or days. This approach, however, proves problematic in agile environments due to inherent uncertainties and dynamic requirements. Story points, on the other hand, represent a relative unit of effort required to complete a user story. Unlike hours, they don't translate directly to time but reflect the overall complexity, risk, and size of a story compared to others.

How To Calculate Story Points?

It is hard to calculate story points in an agile setting as they are often subjective and vary based on the project. Instead, they are assigned through a collaborative effort among the team members involved in the project. However, the process does have some universal steps that can be applied to a myriad of teams:

1. Understand The User Story: Ensure everyone has a clear grasp of the user story's requirements and acceptance criteria. This forms the basis for estimating the effort involved.

2. Establish A Baseline (Optional): If it's your team's first time estimating story points, choose a simple, well-understood user story as a baseline. Assign it a reference point value (e.g., 3 story points) to serve as a benchmark for estimating other stories.

3. Identifying Effort, Complexity, And Risk: These are the three key factors that influence story points. Effort refers to the overall amount of work required for the task. Complexity considers the technical aspects of the task. Risk acknowledges any uncertainties associated with the story.

4. Sizing Techniques: There are various techniques to facilitate discussion and arrive at a consensus on story points. Here are two popular options:

Planning Poker: Each team member secretly estimates the story points, then reveals their estimates simultaneously using cards that utilize the story points Fibonacci scale. If estimates vary significantly, there's a discussion to understand the reasoning behind each estimate before re-voting.
T-Shirt Sizing: This technique uses imaginative T-shirt sizes (e.g., small, medium, large) to represent effort levels (low, medium, high) associated with the story.

5. Consensus: Through discussion and techniques like Planning Poker, the team arrives at a shared understanding of the effort involved and assigns story points to the user story.

Below is an example of how time and effort are assigned to story points:

How to calculate story points Comparison aPPROCHES copy

Best Practices For Using Story Points In Agile

Story Points by themselves are no guarantee that things are going on track all the time. They need to be backed up with certain practices:

Establishing A Baseline: Begin by assigning story points to a set of well-understood user stories. This creates a reference point for estimating future stories relative to the baseline.
Utilizing A Sizing Technique: Popular techniques like Planning Poker involve the team collaboratively assigning points based on a pre-defined scale (e.g., Fibonacci sequence). This promotes discussion and consensus building.
Considering Complexity And Risk: During estimation, consider factors like technical complexity, dependencies on external factors, and potential unknowns. A higher number of story points reflects greater complexity or risk.
Refine And Adapt: Story point estimation is an iterative process. As the team completes sprints and gains experience, they can refine their understanding of point values and adjust their estimation techniques accordingly.

Tools To Help You Implement Story Points

 There are quite a few tools that not are not only geared towards agile development but also feature story points:

Jira

Jira software is a project management tool that features story points. It can assign story point values to user stories within Jira, facilitating relative effort estimation for your agile team. This allows for better sprint planning within Jira, as it can track the total story points in Jira assigned to a sprint and monitor progress based on completed stories.

Asana

With Asana software and its built-in story point matrix, teams can define clear criteria for effort, complexity, and risk. This matrix serves as a reference point during estimation sessions, helping assign story points to user stories within Asana. With this combined with Asana’s management features, teams can effectively estimate effort and plan their sprints directly within the platform.

Story Points: The Agile Estimation Tool You Need

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