Why We Choose Story Points For Agile Project Estimation

What Are Story Points?

Let’s start from the beginning and try to figure out what the story points are. Story Point (SP) is a unit of project estimation developed according to the Agile methodology. Unlike hours and staff-hours, this unit is not an absolute value ​​and does not reflect project implementation time. Instead, SP helps estimate a specific task’s complexity, work scope, and possible risks. Based on this data, we set a deadline and share it with our clients.

Story points are relative values

How To Assign Story Points?

There are several techniques to assign SPs to a user story. All of them are based on the Fibonacci series, which assumes that each subsequent number is the sum of the previous two. You can use the Fibonacci sequence as it is, estimating your tasks with 0, 1, 1, 2, 3, 5, 8, 13, 21, etc. or opt for 0.5, 1, 2, 3, 5, 8, 13, etc. number sequence, which is more typical for Agile project. Another way is to choose one of the methods below. They are also based on a relative assessment but slightly differ by the accuracy.

Benchmarking

You take one user story as a standard and assign any number of SPs to it. All subsequent stories are ranked relative to the base story. For example, if you give twice as many points to the task X as to the base task, it means you should work doubly hard to perform it. This method helps you quickly estimate the task implementation speed as you roughly understand the base “weight.” However, it is not always easy to determine the weight of a problem in such relative units, especially for large user stories.

Compare base task with other tasks

T-Shirt Sizes

Using this method, you evaluate user stories with T-shirt sizes, such as XS, S, M, L, XL, etc. The smallest size indicates the easiest and fastest-performing task, the biggest — the most challenging one. This method provides a less specific difference as for the complexity of the backlog items compared to benchmarking. For example, the difference between L and XL is hardly recognizable and can be understood differently by team members. At Softensy, we use this method to quickly differentiate tasks at an early stage.

Estimate task with t-shirt sizes

Ideal Time-Frame

Here you set the ideal number of hours or days needed to perform each user story in a project. Remember, the perfect time frame should be realistic, but it does not show the actual time need for task implementation. Later, you will have to translate the ideal hours to the real hours anyway, considering all the time losses. So, perfect time units act as an analog of SPs. This method is good because it is more specific. It is easier to estimate the time than an abstract point. However, this assessment is often subjective and does not coincide with the real capabilities of the team.

Assign ideal hours to a task

How To Estimate Time With Story Points?

Calculating in story points is nice for internal needs. However, your customers will be somewhat confused if you provide the project estimation in SPs. At Softensy, we set a deadline in hours and suggest the estimated release date. We show how long it will take to implement a specific feature (usually in the min-max range) and its cost. Our time estimation comes from the previous assessment in SPs. Some might argue that we do double work, but it is not so. SPs allow us to prioritize tasks quickly. Afterward, it is not a big deal to calculate the time of implementation. Moreover, having a background in SPs, we can easily change the time frame depending on the circumstances.

Example Of Project Time Estimation Using Story Points

Imagine you have a project that weighs 100 SPs with two developers working on it. The first developer’s work scope is 60 points, and their speed is 1 point per 2 hours. The second developer’s work scope is 40 points, and their speed is 1 point per 3 hours. Based on this data, we can calculate the project implementation time. To do this, we multiply the SP number by 1 SP execution time. The general calculation formula looks like this:

PT = Nsp * t,

where

Nwd = PT / Nph,

where

How To Update Deadline?

What if circumstances change? For example, a new developer comes to the project, or a third-party service rolls out a major update? In this case, you need to reestimate the deadline. With the SP approach, it is easy to do.

Conclusion

Story points help quickly prioritize the backlog items and identify the most time-consuming tasks in a project. Although SPs are relative values, they are easily converted to hours or days to provide a customer with a project estimate in standard measurement units.

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Softensy

Softensy specializes in fintech development and enterprise-level apps. Our team helps companies automate business processes by developing software solutions.