Estimating how long it will take to accomplish all tasks and deliverables is one of the most challenging aspects of planning a project. Therefore, agile introduces Story Points instead of traditional project planning techniques.

Since estimation is the biggest unknown variable, Story Points allows businesses to agree on an approximate timeline to complete a given task.

What are Agile Story Points?

In Agile, story points estimate the total effort required to do a particular task. Story points are based on relative estimation.

Relative estimation means that guessing the efforts required to complete a task is judged concerning how much time and effort is needed to complete the other tasks. The unit of complexity used to measure this type of estimation is called the story point. A story point is a number that lets the team know about the effort required to implement a specific user story.

Three factors influence the story point estimation:

• Amount of work to do

Now let us imagine that there are two simple tasks. The first task is to fold one basket of clean laundry, and the other task is to fold 10 baskets of fresh laundry.

When estimating the efforts, the second task will get more story points than the first, even though the task is the same. But because one would require more time and effort to finish the second task, it will require more story points than the first.

So the amount of work to do, irrespective of the complexity and risks, influences the estimation of the story points.

• Risks and uncertainties

The risk and uncertainty in a user story should affect the story point estimate. For example, if the team is unclear about the task or how to complete a given task, then that lack of clarity should be reflected in the story points.

The more uncertainties and risks involved in the user story, the higher the story point estimate will be.

• Complexity

The complexity of the work also influences the story point estimation.

For example: If instead of simply folding 10 baskets of laundry, the task is folding clothes in the Konmari folding method, then the complexity of the task increases considerably. So the story point estimate of the task will reflect it too.

The more complex the task, the higher the story point estimate of the user story!

How do you calculate Story Points?

The agile story point estimating process generally occurs during the Product Backlog Refinement Session. The development team and the product owner take part in this session. Although the product owner doesn’t participate in the actual story point estimating, they undertake the task of explaining the user stories to the team.

The team then estimates the user stories using either the commonly used Fibonacci sequence or the t-shirt sizing method.

A baseline user story is selected. Whether the baseline user story is the easiest or the most basic doesn’t matter. It’s just the standard used to estimate the other user stories.

Let’s understand this process of calculating story points in depth:

Assigning Approximate values to each story point

Remember, the goal of this entire process is to reach an estimate for a task or user story. So before you start estimating story points, assign approximate values for each point.

So, for example, 1 story point can represent 5 hours’ worth of work. So then, 2 would mean 10 hours, and so on.  This is just an example; your approximation will depend on the nature of tasks in your backlog. You can decide on minutes or even days as a key.

Choose A Baseline Task

The team chooses a baseline task from the list and gives it an estimate. It can be anything. It doesn’t matter.

Every task will be judged in relation to this baseline task.

Start the process of estimating

Once the values are assigned and communicated with the team, the story points are estimated for each task or user story in the list.

For example, let’s consider the following tasks in your backlog:

• Conduct a feedback survey with 10,000 subjects
• Clean 500 rows of supplier data
• Make the new website page live
• Make a few color changes in the packaging

Now, each of these tasks will be presented to the team individually. The team will then estimate a story point for each task depending on the risk, repetition, and complexity of the task as compared to the baseline task.

For example, Baseline task: Story point estimate is 3

Then the team will estimate the first task as more complex or easier than the baseline task. If it’s easier, the story point estimate will be less than 3 and vice versa.

Remember that this is also the stage where team members frequently use Planning Poker, a game in which they hold up a card with a number to indicate an estimate. Members explain the reasons why they have chosen that particular story point estimate.

Continue until your team reaches a consensus

This process will continue until the team reaches a consensus on a story point estimate for every task in the backlog.

Conclusion

Once your Story Points have been allocated, you may start giving certain teams or resources specific assignments. Making sure that no individual or team has an excessive number of high-effort Story Points in one Sprint, you’ll shift them from the backlog into a Sprint in the order that makes sense.

The estimation is a partial deadline. It’s not set in stone. It is an approximate estimate to determine if we are talking about weeks or months of development. When a deadline is established, you can make a more educated decision to descope the initiative and achieve the deadline because of the relatively consistent pace.