Agile Estimation in Practice

The longer I spend working as an agile coach, the more I find myself in disagreement with Hamlet. To estimate, or not to estimate? That is the question. Out of all of the agile practices which have been adopted in recent years, few have proven more controversial than this one. The battle for and against rages like Shakespearean armies set against each other's teeth. (Free Estimation Ebook)

At first blush there doesn't seem to be any reasonable cause for disagreement. The rationale for making estimates is ostensibly straightforward. If a team is to work in Sprints, and to deliver something at the end of each one, then the work must surely be estimated. Otherwise how can the team know if it is even possible to do the work within the Sprint? How can they commit to deliver something by the end of that time-box if the effort involved is of uncertain magnitude?

Well, there are two things that we need to draw out at this point. Firstly, the above rationale assumes that Sprints will be used, and that delivery will therefore be time-boxed. That's a very Scrum oriented philosophy...but Scrum isn't the only agile way of working. Lean-Kanban teams, for example, don't use Sprints and rarely make use of estimates. Secondly, Scrum itself says nothing about estimation. It only says that each item in a backlog must be sized - how that sizing happens is up to the team. It should also be remembered that a Scrum team commits to a Sprint Goal that delivers value, not to the delivery of a certain number of estimated points.

So then...to estimate, or not to estimate? Let's listen in at the camp-fires of each side, and pick out in more detail the arguments they make for and against.

For (Ye Scrum Brigade of Sprinte and Stande-uppe)

• "Estimates allow us to predict when a Sprint Goal will be met, and therefore when a substantial increment of value will be delivered"
  
• "Our estimates help our stakeholders plan ahead. They are part of the value we provide" 
  
• "Estimates help us to de-risk scope of uncertain size and complexity"
  
• "Estimated work can be traded in and out of scope for other work of similar size. Without estimates you can't trade"
  
• "The very process of estimation adds value. When we estimate we discuss requirements in more detail, and gain a better understanding of what is needed"
  

Against (Ye Lean Kanban Brigade of Boarde Pullers)

• "Estimates are rarely accurate. All you are doing when you estimate a piece of work is to set false expectations"
  
• "In practice, estimation is seen as a commitment, not as a best guess. Every time you make an estimate, you make a rod for your own back"
  
• "Estimation is time consuming. The time a team spends playing planning poker or whatever is time that could have been spent on delivery. Estimation is waste."
  
• "It's the actuals that matter, not estimates. Agility requires metrics, and the only metrics that count are those that reflect actual delivery"
  

Both sides are right

If you see this debate in terms of whether a Scrum or Lean-Kanban process is being followed, then both sides are right. A Scrum process is optimized for project work where scope risk is high and an entire system is represented. The requirements tend to be uncertain, complex, and very heavily intertwined. By committing to a Sprint Goal and to the delivery of a substantial increment of value, that risk can be managed. Uncertain and interdependent requirements are batched together into a Sprint and dealt with as a group. When this is done well, you have a clear Sprint Goal and a coherent Sprint Backlog. When it is done badly, you have a vague or disjointed Sprint Goal, a mishmash of requirements that command no sense of team purpose, and no team commitment towards the delivery of an increment.

A Lean-Kanban process, on the other hand, is usually focused on "Business As Usual" (BAU) activities. The diet of a Lean-Kanban operation should consist of small and repeatable changes. They don't have to be related at all...in fact they shouldn't be. Things like bug fixes, minor enhancements, and administrative tasks are representative of this kind of work. Scope risk is low because the process of making such changes is well understood. Estimates are generally held to be unnecessary because there is very little uncertainty to deal with. There is no need for work to be batched...each change can be actioned and delivered independently of all others. Work is enqueued and actioned according to priority and the required quality of service. Predictions are based on the actual rate of delivery, not on estimates. In a Lean-Kanban way of working, the actuals are indeed everything.

Methods of estimation

So then, estimates add value where scope is uncertain and there are associated risks to be managed. That's why Scrum teams engaged on projects typically make use of them, but Lean-Kanban BAU teams generally don't. Now let's look at three simple methods of estimation that Scrum teams, or other teams doing project work, can make use of.

Planning Poker

This is a well established technique popularised by Mike Cohn, and variations on his Planning Poker cards can be found in offices across the world. A typical Planning Poker set has cards with the following numbers: ½ 1 2 3 5 8 13 20 40 100. Nerds will observe and be irritated by the fact that this is roughly (but not quite) in line with the Fibonacci sequence. Here's how it's played:

• An identical hand of cards is given to each team member. Each team member will have a set of cards with numbers on the above pseudo-Fibonacci scale.
• The Product Owner describes the piece of work to be estimated. Normally this is a user story with acceptance criteria.
• Each team member mentally estimates the size of it on the scale. They can ask the Product Owner questions to clarify any points, but for the moment they will keep their estimate to themselves.
• Each team member places the card that corresponds to their mental estimate face down in front of them.
• At the facilitators instruction - usually the Scrum Master -  the team turn their cards over. In an ideal case the cards will all have the same value, suggesting that the team have a common understanding of the requirements and the likely effort that will be involved.
• If the values are different, the team then need to discuss their estimates and their reasoning behind them. They need to understand each other’s thinking, and from that reach a consensus. It may be necessary to replay the cards several times before agreement is reached.
• By convention, estimates are written on the corner of a User Story card before being placed on a Scrum board.

A variation of this takes from a suite of regular playing cards. The Ace (1), 2, 3, 5, 8, Jack, Queen, and King might be used. The Jack signifies that no or negligible work needs doing (jack all). The Queen indicates a larger story that should be broken down in the planning session and reconsidered, while the King indicates an epic that will need greater analysis and cannot be brought into scope for this Sprint. The Joker can be played if anyone wants a coffee break.

As an estimation method, Planning Poker has the advantage of being fairly democratic. Every team member gets a hand of cards and is allowed to play, and has a clear opportunity to explain their reasoning to the others. The disadvantage of Planning Poker is that it can be rather time consuming in comparison with other methods. It can also encourage novice teams to estimate in terms of time, as they are often initially prejudiced to correlate points to hours or days. This prejudice must be challenged and eroded if the relative sizing of estimates is to be achieved.

Team Sort (T-Shirt Sizing)

This is a good way of doing team estimates if no planning poker cards are available. All you need are six scraps of paper and a set of index cards with the requirements (e.g. user stories) written on them. Normally these will be the same index cards that go on the Scrum board. 

• Write one of the following sizes on each of the scraps of paper: Extra Small (XS), Small (S), Medium (M), Large (L), Extra Large (XL), and Extra Extra Large (XXL)
• Arrange the sizes in a horizontal line on a table, ordered from XS on the left to XXL on the right.
• Put the pile of index cards on the table in front of the sizing line.
• The team then collaborate to organise the requirements on the cards under the headings XS to XXL. They can ask the Product Owner to clarify any questions that they may have while doing so.
• Once the cards have all been sorted, story points can be allocated to each of them by mapping each T-Shirt size to a value. This allows metrics to be gathered about the flow of work, and used to populate a velocity or burndown chart.

An advantage of the team sort is that it is quick and easy to do. The complete set of requirements is estimated in one sweep. Also, it is a fairly direct way of achieving relative sizing. There is no temptation to correlate points to hours. The disadvantage is that it is potentially undemocratic, in that assertive team members can dominate meeker ones with their opinions.

There is a variant of the team sort which encourages more egalitarian behavior. Each team member takes it in turns to move one card by one position. They also have the option to pass, i.e. to not move a card. Eventually a consensus should be reached and no more cards will be moved. However this is a more time consuming method and deadlocks can occur. These deadlocks can be difficult to spot if multiple card shifts are caught in the cycle.

One Point One Card

This method is a spin on the Lean-Kanban approach of tracking actuals. Instead of estimating the relative effort required for each story card, the team estimates how many stories it is likely to complete in the Sprint being planned. This can be as straightforward as using the yesterday's weather analogy for velocity estimation. Just as the weather today is most likely to resemble the weather yesterday, the velocity that will be achieved by a team in the upcoming Sprint will most likely match the velocity of its predecessor. So if two dozen cards were completed in the last sprint, approximately two dozen can be expected in the one that follows. The budget can be adjusted to allow for holiday, foreseeable absences, and other such changes that will impact the team's commitment.

The advantage of this system is its raw simplicity. The estimation overhead is almost negligible. Also, it encourages the authoring of small user stories that will spend little time in progress and that stand little chance of being impeded. The liquidity of the board is therefore increased and further requirements analysis is encouraged. Some variation in size will be inevitable, and there will be statistical outliers, but the effects of these will average out as the flow rate increases. The disadvantage of this technique lies in the separation of fine-grained user stories from business value. There is a significant risk that they will become excessively technically focused and task-like.

Conclusion

Agile estimation is often seen as being invaluable, yet others dismiss it as waste. The reasons for this disagreement can be traced to disparities in Scrum and Lean-Kanban ways of working, and to the fundamental differences between project work and Business As Usual. When seen in the context of Scrum projects, some form of estimation process is valuable.

Yet regardless of the method chosen, it must be acknowledged that a Scrum Team is responsible for its own estimates. No-one else can make a team's estimates for them. Going through that process of estimation, and understanding the size and scope of the work, is fundamental to the team's sense of Sprint Backlog ownership and to their commitment to a Sprint Goal.