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Relative Estimations and Story Points in an Agile Environment | David Tzemach

Updated: Mar 2, 2022

In an Agile environment, estimation is conducted by the team as part of their preparation for development. The estimation is done by following one of the practices listed below:

  1. Traditional estimations are based on the days and hours used in traditional software development projects.

  2. Relative estimations are based on comparing items or by grouping items of equivalent size and effort.

  3. Not estimating at all.

Definition of relative estimation

There are different definitions of relative estimations. The commonly accepted definition is as follows:

“Relative estimation is one of the several distinct flavors of estimation used in Agile teams, and consists of estimating tasks or user stories, not separately and in traditional units of time, but by comparison or by a grouping of items of equivalent difficulty. “ - The Agile Alliance

What do story points represent?

Relative estimation does not use man-hours or days in a traditional working environment. Instead, relative estimations use other techniques such as "story points", which represent a unit of measure for the overall effort (each story point represents a subjective unit of time) that the team needs to invest in delivering a user story. For example, a single-story point can represent a range of 3-10 hours; two-story points can mean a range of 8-18 hours.

The team usually doesn’t have all the necessary information to provide precise estimations for implementing their stories during the estimation process. Using relative estimation can provide a time range for delivering a user story. This is without worrying about the consequences of missing the target time, as in the traditional estimation process.

Who should be involved in the relative estimation process?

That is very simple. The estimation process must involve the team members who take the responsibility and commitment to deliver the story at the end of the sprint (incl. coding and testing activities).

What is included within a story point estimate?

A story point estimate must address different factors that may affect the overall effort, which include:

  • Coding activities.

  • Risks and uncertainty in doing the work.

  • The testing effort the team should invest.

  • Interfaces with other teams.

  • Knowledge and technical experience.

  • The complexity of the work.

  • The Definition of Done.

When a team estimates a user story, they must consider each item presented in the list above. Ignoring any item will lead to poor estimations that will eventually affect their ability to deliver.

Benefits of Relative Estimations

Relative estimations help most teams when used correctly. Some teams find traditional estimations more suitable. Remember, relative estimations are great but cannot just ignore traditional estimations because they are less appealing.

Now, let us look at some of the benefits the team can gain using relative estimations over traditional estimations:

Reduce fear of commitment

The use of relative estimations helps reduce the stress involved in the commitment process. When team member estimates the work without stress (or at least with less stress), they have a clear mind and thus provide better estimates.

In traditional estimation, the team estimates tasks in days/hours. This type of estimation is more strict and requires almost complete accuracy. Therefore, it is most likely that an immature team will experience high stress about not completing the item by the time committed.

Increase collaboration

Using relative estimation techniques (e.g. planning poker) involves the team in the estimation process. I use planning poker as one of the most important activities to promote the team’s self-organization. This estimation technique helps the team share their knowledge and experience and raise (constructive) criticism to other team members.

The relative Estimation process is relatively faster.

Over the years, I have done hundreds of planning sessions using both relative and traditional estimations. In my experience, after a few sprints, once the team becomes more experienced in relative estimation, it results in a faster estimation process compared to traditional estimations. This is because the traditional estimation requires people to consider many aspects to ensure they provide an accurate estimation.

Relative estimations make planning real.

The use of story points and velocity makes the planning session real. It allows the team to focus on how well they perform instead of focusing on less important things such as "why are the estimations taking so many days?” or “is there a way to finish the work in half of the time?" etc.

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