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One of the critical success factors for story point estimation is that the development group estimates the stories as a team using the same scale. Once the story points are estimated, the values are translated into the team’s velocity to forecast future sprints, iterations, or efforts. Velocity represents the total of story points that the development team can deliver in a specific iteration, and is a useful predictor of the team's capabilities. Story points are independent of time units and are a successful and common approach in software development estimation. However, there could be disadvantages to using story points as a critical factor in the success of story point estimation is a team’s shared experience. Establishing velocity in the initial iterations is challenging, as team members have not had experience working and estimating as a collective group and experience challenges in providing accurate estimates. The story pointing approach, although commonly used, is subject to error.
Using story points for estimation has several advantages:
Focus on Relative Effort: Estimating in story points encourages the team to think in terms of the size of the task relative to other tasks, rather than trying to determine exactly how long the task will take. This often leads to more accurate estimates because humans are generally better at comparing things than at absolute estimation.
Account for All Aspects of Work: Story points allow for a holistic view of the work. They take into account not just the time it takes to code a feature, but also the complexity of the solution, the effort required to test it, any potential risks or unknowns, and so on.
Independence from Individual Abilities and Availability: Since they don't directly correspond to time, story points allow for variations in the team's productivity. For example, a task that might take a more experienced developer one hour to complete might take a less experienced developer four hours. In this case, the story point estimation would be the same for both, because it represents effort, not time.
To estimate with story points, Agile teams often use a technique like Planning Poker, where each team member makes an estimate and then the team discusses the differences to reach a consensus. This not only results in more accurate estimates, but also helps the team understand the work better and uncover potential issues earlier.
Story points are typically assigned on a scale, which can be linear (1, 2, 3, 4, 5...) or exponential (1, 2, 4, 8, 16...), with the latter being more common as it reflects the inherent uncertainty in larger, more complex tasks. The scale used can vary from team to team.
Finally, it's important to note that story points are a measure of effort, not value. A story that requires a lot of effort will have a high number of story points, but it may or may not deliver a correspondingly high value to the customer or user. Determining the value of different stories is another important aspect of Agile planning and prioritization.