Top 10 Agile Estimation Techniques for Project Managers In 2023

agile-estimation-techniques

One of the things agile project managers struggle the most with is an accurate agile estimation. How are PMs identify the time and effort required to accomplish a task in the backlog? How can one be sure that their plan will work in the long run?

When things get tough for PMs, they turn to agile estimation techniques to empower their decision-making. With the right tips and tricks up your sleeve, you can easily make near-perfect estimations and set your project on the road to success.

In this article, we are going to give you a rundown of 10 Agile estimation techniques that can make your life as a PM much easier. However, before we get to the techniques, let us first take a look at the definition of agile estimation and understand why it is important.

What Is Agile Estimation and Why Is It Important?

Agile estimation is estimating the amount of time, cost, and effort required to complete a task. It takes into consideration the complexity of the task itself and aims to calculate the duration of a task.

Estimation in agile is more than just guesswork or a hit or miss, a lot of thinking, and planning goes into the process to make sure it bears fruit for the business as well as the individuals involved in the process.

Estimation is a key critical part of agile project management. Accurate estimations translate into better management, beneficial results, and an overall increase in growth and productivity.

Here are 5 reasons why estimation is important in Agile:

  1. More Accurate Planning: In opposition to traditional estimation, Agile moves from the top to the bottom. This means Agile teams first estimate the total time required to complete the project and then break down small chunks of time and lot them into different tasks. This way complex tasks are allotted a longer time while simpler ones have less time allotted to them. Agile estimation, in this way, makes planning much more accurate, and ultimately leads to better results.
  2. Better Team Coordination: A project’s success is not determined by individual effort but by the collective effort of the whole team. Teamwork makes the dream work and team coordination is the first step in accomplishing that dream. Estimation, in Agile, allows team members to communicate frequently. It contributes toward team building and encourages team collaboration, leading to better coordination.
  3. Better Decision Making: With estimation in Agile, teams can not only accurately plan for the future and accurately time their activities but also ready themselves for the unseen. Thorough planning and deep insight into what works best for your team can help make better decisions for the benefit of the business.
  4. Better Understanding: Estimation in Agile entails deliberation on tasks and understanding the ins and outs of the project. A better understanding of the tasks means team members can make better assessments of the importance of a task as well as the time required to complete it.
  5. Improves Productivity and Efficiency: Agile teams strive to improve their productivity and efficiency in order to make the most of available resources and deliver high-quality deliverables. One of the best things about estimation in Agile project management is that with accurate estimations, teams have a better understanding of the task as well as the time and effort that will go into it. With such estimations, team members gradually become more focused which ultimately adds to team productivity and efficiency.

Dive into the realm of Agile estimations, and once you start seeing the profitable results, we are sure there will be no turning back for you or your team.

Also, see:

Estimating Projects: What you Need to Know?

Top 10 Agile Estimation Techniques:

top-agile-estimation-technique

While a vast majority of PMs rely on Planning Poker for Agile estimations, there are plenty of other techniques that can be used for estimation. In the following section, we will go through 10 of the most efficient Agile estimation techniques, including Planning Poker. Without further ado, let’s go!

1. Planning Poker:

Planning Poker is perhaps the most commonly used estimation technique in Agile. With this technique, PMs try to reach a common ground between all the stakeholders. Estimates are decided on the basis of team-wide consensus.

The process starts by distributing numbered cards, representing story points, among the team members. The numbers on the card represent different estimation values. The next step is introducing the user story to the team members.

Teams then discuss the complexity of the task and share their experience for better understanding. Once all team members have understood the complexity of the task and its requirements, they choose a numbered card of their choice.

When cards from all the team members are revealed, the number with the most votes is finalized as the estimate of that task. If, however, the team has been unable to reach a consensus then individuals turn back to discussion until or unless they have reached a common ground.

2. T-Shirt Size Estimation:

T-Shirt size estimation is the next technique PMs can use to make accurate Agile estimations. In this technique, task estimations are made in the sizes of t-shorts instead of numbers. The sizes include XL, L, M, S, and XS.

Different sizes represent different levels of complexities of a user story. An XL-size task is complex and requires more effort and time. In contrast, an XS task is easy to manage and can be completed in less time. Estimations in t-shirt sizes make the process easier and more fun for the team.

The sizes can also be converted into numerical values for team members’ ease.

3. Affinity Mapping:

Affinity Mapping works best with fewer team members and lesser items to work on. For Agile estimations via affinity mapping, team members are asked to group similar items. These items are divided into different categories for added ease.

Team members identify correlations between different tasks and group them. Once groups have been made, values can be assigned to them.

4. The Bucket System:

The Bucket System is an agile estimation technique wherein team members are asked to assign story points to different user stories. This technique is a bit similar to Planning Poker.

Here too, the facilitator creates different buckets with different numbers displayed on them. These numbers represent story points.  As with Planning Poker, user stories are introduced, and individuals place them in different buckets according to their opinion of the estimated effort and time.

Buckets with higher numbers contain user stories that are more complex and require great effort to complete. Smaller number buckets, in contrast, contain items that are much simpler and easier to complete.

5. Dot Voting:

Dot Voting is our next Agile estimation technique that can produce favorable results for the project managers as well as project management teams.

Dot Voting involves the use of post-its and dot stickers which makes the activity a lot more fun. User stories are written on post-its and the notes are posted on a board. Team members are, then, given dot stickers which are to be posted on the item of their choice.

The item with the most stickers is prioritized over others and requires more effort. An item with fewer dots means it’s a relatively simple task and does not require a lot of effort.

This technique is usually employed in smaller teams with fewer items.

6. Big, Uncertain, Small:

This Agile technique is similar to the bucketing technique but instead of having a varied number of buckets, items are divided into three prespecified categories. Each category represents a different size, big, uncertain, or small.

User stories are introduced to the team. Members go through the items and discuss them in detail. After reaching a consensus the item is allotted to a specific category.

The biggest plus of this technique is that it narrows down the items that need discussion. All the items allotted to the uncertain category are neither big nor small. Since these items do not have a specific value assigned to them, team members can discuss the item and the effort required to complete it. Once they have arrived at a decision, they can allot a specific value to it.

7. Analogy:

An analogy is another useful technique for Agile estimation in which analogies are used to make estimations about a task. Different items are compared with each other, and their sizing is determined via relative sizing.

For example, if a user story is twice the size of a previous similar story, then after analyzing the story, twice the same amount of time can be allotted to it. In this way, sizes are compared to assess the time and effort that will go into the completion of an item.

8. Three-point Method:

The three-point story is our next pick in this list of top 10 agile estimation techniques. The technique relies on three different values assigned to the same story. These values are:

  • Optimistic Value (OV): The estimated value if everything goes according to plan.
  • Pessimistic Value (PV): The estimated value if something goes wrong or you encounter difficulty.
  • Most Likely Value (MV): The most accurate and realistic value of all.

Three-point Method is perhaps the most accurate and efficient technique of all. It allows teams to make estimates for every possible encounter. Whether a project progresses smoothly or encounters problems, teams make estimations for every possible route.

9. Random Distribution:

When all calculations and planning fail, you can give the reins to random distribution. Here’s the twist; random distribution is not as random as it sounds. In fact, it has some semblance of organization to it.

Using this method of estimation, teams estimate time in order of priority, from low to high. All the items are placed on a scale with one end representing high while the other says low. Team members discuss each item and move it up and down or right and left.

The process comes to a stop once everyone agrees on the order and there’s nothing left to change in the order.

10. TFB/NFC/1:

TFB/NFC/1 is for teams that like to have a laugh while working. This Agile technique is almost identical to the Big/Uncertain/Small technique. The only difference between the two is the names of the categories.

Here the categories are named: To F****** Big, No F****** Clue, and 1. The items in TFB are complex, the items in NFC are difficult to assign a value to and 1 indicates a Sprint.

Conclusion

There were some of the best Agile estimation techniques you can use in your Agile project management to make estimations less boring and more fun.

We hope you have as much fun reading the article as we had writing it. We hope you will use these techniques in your business. If you do, let us know how it worked out for you.

Till then, goodbye! 

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