Scrum Masters: What’s the point of estimations?

Estimating the work involved in a User Story is a key component to setting a team up for success. What is the point to the estimation, and what is it trying to accomplish?
Estimating the work to be done provides two distinct roles. First, and most important to the scrum team, estimates give us information about the health of the team. When we have accurate estimates, this allows us to quantify the work that is being accomplished by the team. Usually this translates into Velocity, Reliability and Throughput. These metrics should be used during retrospectives to help drive conversations around the team’s health and performance. The only way these metrics are useful is with an ever-more-accurate estimation of the work that went into a sprint.
The second role of estimates, and most important to the business, is that estimates give us a forecast of the future. With somewhat reliable velocity metrics, the team is better equipped to answer the question “When can you get this done by?” I know this is frequently regarded taboo question in Agile, but it comes up often enough that your team may as well be prepared to answer it. When that happens, make sure you include the Agile Value of responding to change over following a plan. While your teams velocity may inform how much you can accomplish, that is subject to change based on several factors, and also doesn’t inform what you will accomplish.
With these two ideas in mind, you are better equipped to answer questions around how to estimate stories, which methods you want to use, and how you facilitate the estimation process. In a future post, we’ll take a look the religious debate of story points vs. hours when it comes to estimating work.
