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What are Story Points and how to estimate them?

What are Agile Story Points?

“Story points are units assigned to a user story to show the measure of effort required to complete it.”

Fundamentally, story points are the number that tells everyone on the team how challenging a story is, based on factors such as its complexity, risks, and efforts involved.

Good estimation helps the team member realize the level of effort for each task and keep the team on the same page by visualizing the workforce and time frame required.

In this article, we’ll unveil the mystery of what are Story points, why to use story points, and a step-by-step guide on how to estimate them.

Agile Story Points: Relative Estimation Technique

In Agile , the story points are assigned through the Relative Estimation technique (agile relative sizing) meaning that values are assigned on a comparison basis.

“Relative estimation is the process of estimating task completion by comparing it with other tasks in similar complexity, risk, implementation, and deployment.”

Why Use Story Points in Agile?

1. Team Velocity can be calculated

“Team velocity is the number of story points completed by an Agile team within a Sprint.”

For example, if an Agile team completes 80 story points in 2 Sprints, then the team velocity is 80/2= 40 story points per sprint.

Team Velocity gives them an idea of how well the team is performing and predicts their performance for upcoming sprints.

2. Product backlog prioritization

Story points help Agile teams identify Epics. Epics are large user stories that cannot be completed in a single sprint. This is particularly helpful to a product owner in backlog prioritization.

The product owner pushes large user stories toward the bottom of the backlog. These stories require grooming to break them into small user stories that can be completed in a single sprint.

3. Accountability on the Agile team

Story point estimation is a team effort where all team members, product owner, scrum master, developers, and testers sit together and estimate effort in completing a story. Hence, the accountability falls on the whole team rather than an individual.

How are Story Points Estimated in Agile?

You may wonder exactly how team members are supposed to calculate story points, considering the values are abstract and not reliant on actual time units. There are several methods available.

Story points estimated methods:

  • T-Shirt Sizing. This scale follows t-shirt sizes, Extra-Small, Small, Medium, Large, Extra-Large, 2XXL, etc.
  • The Linear Sequence. The classic 1,2,3,4,5, etc.
  • The Doubling Sequence. Double each digit in succession: 1,2,4,8,16
  • The Fibonacci Sequence. Each successive digit is the sum of the two previous numbers: 1,2,3,5,8,13,21

Whichever point system you use, the team should remember to ask these questions:

  • How complex is the work?
  • How much work will this take?
  • What are the team’s technical abilities?
  • What are the project’s risks?
  • What parts of the project are we unsure about?
  • What must be in place before the team can start/finish?
  • What could possibly go wrong?

Remember that the points measure a relative ratio. The actual number used is irrelevant. What matters is that each digit multiplies the difficulty. A “1” story point is the easiest task, and this value should be consistent across all projects. The “2” story point equals double the “1” story point’s effort. 3 story points are triple the “1” story point, etc.

Typical steps of Story Points estimation:

Step 1 : The Scrum Master initiates and moderates the meeting. Including deciding a base story and which sequence to use.

The Scrum Master is also responsible for creating and maintaining the project’s burndown chart.

Step 2 : The product owner briefly overviews the single Product Backlog Item (PBI) that the team is estimating. Then, the group asks questions and discusses risks and assumptions.

Step 3 : The team decides on a story point estimation matrix, establishing baselines of what constitutes minimal risk, repetition, and complexity.

Step 4 : Each development team member compares the PBI size relative to the PBI calibration and picks an estimate. Only development team members can estimate.

Team members call out their estimates simultaneously. The product owner can ask why members chose specific numbers and discuss the matter further.

Note that this is also the phase where team members often use Planning Poker , a means of expressing an estimate by holding up a card with the corresponding number.

Members with exceptionally high or low estimates explain their rationale. The product owner can clarify certain points and negotiate expectations, thereby reducing the substantial point gaps. Repeat the process until the team reaches a consensus.

This article discusses the importance of Story point estimation and the steps to estimate Story points. We show that Story points estimation is much more trivial than it looks. However, the main challenge comes after the Story points estimation when the team works on them and needs to keep track of the work and calculate their team velocity. ONES Project Management tool helps the team to do all these tasks and much more. For more information, please visit

Originally published at on December 9, 2022.

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