Estimating task times can feel like a high-stakes guessing game.

Project managers must set accurate due dates to create a timeline that sets appropriate stakeholder expectations. And yet so many factors are at play, like financial roadblocks and sick employees.

But time doesn’t have to be the only metric you rely on when creating an accurate project timeline. Although hours, days, and weeks are convenient measuring sticks, they don’t account for the complexities teams face during project execution.

That’s why some managers set “story points” to define time frames. This method also accounts for non-time-based features, like risk and effort, to offer more comprehensive and flexible sprint planning.

What are story points?

Story points are measurement units for a project’s tasks that focus on qualitative features like effort rather than time. In a story point grading system, team members assign numbers to smaller assignments within an overarching user story to determine the difficulty of each unit and predict resource requirements. Typically, when teams give story point values to objectives, they analyze three features of each task:

  1. Risk: Any uncertain variables associated with a task heighten its risk profile, often resulting in a higher story point score. When assessing an assignment’s risk profile, teams identify and analyze factors outside their control for a specific activity, including resource constraints, regulatory uncertainty, and external dependencies.
  2. Complexity: Whereas risk focuses on uncertain conditions surrounding a project plan, complexity considers the difficulties a team faces in achieving a pre-established goal. For instance, if engineers aren’t familiar with a new software tool, project leaders factor in a higher learning curve to their complexity score. Tasks with higher complexity ratings need more resources, expertise, and collaboration, and they end up higher on the story point list.
  3. Repetition: Managers also compare assignments on a current project plan to prior tasks to check for similarities before assigning user story points. When an employee has previous experience and documentation accomplishing comparable goals, it’s less likely they’ll face friction during the execution phase. By contrast, novel tasks have higher story point scores since teams don’t have first-hand knowledge of these issues.

An essential feature of story points in agile development is they have a “relational” nature rather than relying on an “absolute” time-fixed schedule. The story points a team assigns to each task make sense relative to all other story points assigned within a user story. Instead of listing a rigid timeframe for each microservice, teams see a more realistic estimate for each task by considering its unique risks and difficulty level. For instance, if one assignment has a story point value of 1 and another has a value of 2, managers estimate the second task takes roughly double the amount of effort, resources, and time as the first.

Benefits of using story points in agile project development

Since story points only give relative estimations of a project’s completion date, they seem to make it more challenging to forecast the expected arrival of deliverables. But as you learn to incorporate story points into agile project development, you’ll notice it’s actually easier to give stakeholders more realistic roadmaps than time-bound models.

Here are a few more benefits of using the agile story point method.

Offers a more accurate workflow measurement

While story point estimation doesn’t give precise “due dates” like time-based estimation models, it accurately accounts for real-world issues teams face when they start project sprints. Since story points help teams quantify elements like risk and complexity, they give project leaders a more transparent forecast on when to expect deliverables and how to allocate resources for optimal success.

Focuses on deliverable quality rather than due dates

The focus of story points is on what it takes to complete a task rather than when it’s due. By doing away with rigid timeframes, employees don’t have to deal with the psychological and productivity hangups associated with working toward a strict deadline.

Increases adaptability

Compared with time-based estimation, story points give managers and team leaders greater flexibility to adjust scores in relation to unexpected events. Suppose an expert software engineer suddenly leaves while developing an algorithm. With a story point system, you can change the difficulty score and reallocate resources to account for these real-world contingencies.

Encourages team collaboration and communication

Team meetings are essential to calculating story points and developing workflows. Instead of enforcing completion dates in a top-down structure, evaluating story points allows everyone to voice their concerns and collaborate as they design their workflows.

Builds a data repository for future projects

As teams use story points to designate and estimate tasks, they build valuable information for future project projections. You can keep detailed notes on prior story point scores and tasks to compare against current user stories for data-driven and streamlined agile work estimations.

Story points estimation: How to calculate story points in agile project management

No “scientific method” exists for estimating story points, but assigning these values is always collaborative. Typically, managers set aside a few hours for a “planning poker” meeting to discuss upcoming tasks and agree on their story point values. After this session, everyone clearly understands their responsibilities and the difficulty rankings for each assignment.

Here’s how to use the story point method for project timeline preparation.

1. Discuss a baseline user story

Since story points only make sense in relation to other tasks, teams must first decide on a reference story for future calculations. To do this, you’ll use a user story from a previous project development cycle with low difficulty and assign it a value of 1. Remind team members they need to assign subsequent story points in relation to each other, with this first example serving as a baseline.

2. Decide on a story point grading system

After selecting a base user story, pick a story point grading system to give each task a quantitative value. Although some teams use a linear “1, 2, 3” scale, the Fibonacci sequence — where every value is the sum of the preceding — is most common.

But there are other viable grading systems. Some teams prefer using the “T-shirt sizing” system where each task gets a shirt size, such as small, medium, or large, depending on its complexity. Review the different approaches for assigning story points and choose the one your team feels the most comfortable using.

3. Play planning poker with backlog tasks

With the preliminaries out of the way, it’s time to dole out cards and start the first round of “planning poker.” During this meeting, each team member gets cards with the agreed-upon values, such as Fibonacci numbers, and managers present a task assignment in a new user story for discussion.

After reviewing the features of a backlog task and potential concerns, everyone selects the card they feel best accounts for the effort and risk of an assignment. If there are wide discrepancies between story point values, lead another round of discussions to address concerns and figure out how to adjust the task’s specifications so everyone assigns the same Fibonacci sequence number.

The goal in this stage is to achieve group consensus and modify assignments until all team members feel the same way about their responsibilities and each task’s complexity. Never take the average of a team member’s scores when assigning a story point estimate, and don’t move from one story point to another until everyone agrees on the same value.

4. Schedule a sprint retrospective to assess project velocity

Following the first sprint for a project using story points, lead a sprint retrospective meeting to analyze, forecast, and refine workflow procedures. On top of addressing new issues and risks, you’ll estimate your team’s “velocity” by calculating how many story points they complete per sprint session. While story points won’t reveal an exact end date, figuring out the average story points in a sprint helps leaders with future sprint planning and forecasting project closure.

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