Helpful Summary

• Overview: We introduce Agile estimation techniques as essential tools for project management and give you a comprehensive list of the best techniques to use.
• Why trust us: We’re a leading async Agile meeting tool with tons of experience helping Agie teams all over the world manage their projects efficiently.
• Why this is important: Agile estimation techniques improve planning, increase transparency, enhance collaboration, and enable better prioritization.
• Action points: Read through the options on this list, try them out in your next Agile meeting, and see which techniques work best for you and your team.
• Further research: Check out the Teaminal blog for more tips and tricks on Agile project management.

Find The Best Agile Estimation Technique To Use 

Best guesses and optimistic planning are the enemies of productive Agile development. Neither produces predictable results or results within an acceptable margin of error. 

Agile estimation solves this problem. It involves predicting the future using available information and fine-tuning as you go. But with so many techniques out there, how do you know which one is the best for your team?

In this Teaminal article, we’ll learn more about Agile estimation techniques and give you the tools to find the one that works best for you and your team.

But first…

Why Listen to Us?

Teaminal is the Agile meeting tool of choice at renowned companies like Angi, Clear, Hello Fresh, Ikea, Medium, T-Mobile, and Workday. We’ve helped countless high-performing Agile teams stay on track and deliver quality products on time.

Over the years, we’ve learned a lot about the importance of Agile estimation and how to do it effectively. We’ve seen firsthand how choosing the right technique can make all the difference in delivering successful projects.

So let’s dive into the world of Agile estimation.

What Are Agile Estimation Techniques?

Agile estimation techniques are methods used in Agile project management to estimate the time, effort, and resources required to complete tasks or deliverables. These techniques focus on collaboration, flexibility, and adaptability, allowing Agile teams to make informed decisions about project scope, schedule, and priorities. 

For example, imagine you’re pulling in a user story from your product backlog. 

Your team needs to estimate how long it will take to complete this task so that they can plan out the rest of the sprint. In traditional project management, you might use techniques like Work Breakdown Structure (WBS) or Critical Path Method (CPM) to estimate time and resources. 

However, these methods don’t always translate well into Agile environments where requirements are constantly changing. That’s where Agile estimation techniques come in.

Benefits of Agile Estimation Techniques

• Improved Planning: Agile estimation techniques help teams plan their work more effectively by providing insights into the effort required for different tasks or user stories.
• Increased Transparency: Estimation techniques promote transparency within the team by ensuring that everyone understands the complexity and effort involved in each task or user story.
• Enhanced Collaboration: Estimation techniques encourage collaboration among team members as they work together to estimate the effort required for various work items.
• Better Prioritization: Estimation helps teams prioritize their backlog refinement or list of tasks based on their relative size or complexity, ensuring that the most important work is addressed first.
• Faster Decision Making: With estimation techniques in place, teams can make faster and more informed decisions about project scope, schedule, and priorities.

Criteria To Consider When Choosing an Agile Estimation Technique

Accuracy

It’s important to pick an Agile estimation technique that gives reliable guesses. Look for one that considers past experiences and team agreement. Make sure it can handle different kinds of tasks and uncertainties well. This way, you can plan better and avoid surprises during your project.

Choosing an estimation technique that consistently produces accurate estimates will improve planning, decision-making, and project success.

Ease of Use

Consider how easy it is for your team to understand and use the estimation technique. Look for simple methods that do not require extensive training or expertise.

Choose techniques everyone on the team can quickly grasp and apply, ensuring smooth and efficient estimation processes. A user-friendly technique will save time and make getting everyone on board with the estimation process easier.

Flexibility

Ensure the technique allows for adjustments as project requirements change or new information becomes available. Choose a method that accommodates your team and project’s unique needs and dynamics, allowing for flexibility in estimating tasks or user stories. 

This way, you can tailor the estimation process to fit your specific project context and ensure accurate and relevant estimates.

6 Best Agile Estimation Techniques to Try

Here are some effective approaches for estimating project tasks in Agile development:

1. Planning Poker

Planning poker is probably the most widely used Agile estimation technique.

It involves a group of team members coming together to estimate each task on a project using “cards” with numbers representing the estimated effort for that task. The numbers on these cards are often chosen from a Fibonacci sequence (1, 2, 3, 5, 8, etc.) to encourage relative estimation rather than precise numbers.

The team members discuss and debate their estimates until they reach a consensus. This approach encourages collaboration and ensures that everyone understands the effort required for each task.

How it works: 

In practice, planning poker involves the following steps:

1. PO or PM presents a user story or task to be estimated.

2. Each team member receives a deck of cards with numbers on them.

3. The PO or PM reads out the user story/task and any accompanying information.

4. Team members privately select a card representing their estimate.

5. If there is consensus on the estimate, then that number is recorded as the final estimation for that task. If there are differing opinions, team members discuss their reasoning and re-estimate until a consensus is reached.

6. The process continues until all tasks have been estimated and recorded.

This can be an in-person or live virtual meeting, but it doesn’t need to be. With Teaminal, you can hold async planning poker sessions through Slack or the Teaminal web app.

The process is largely the same, but there are a few key differences. 

For starters, the user story and acceptance criteria are automatically pulled from your backlog. Instead of calling a meeting, team members get Slack notifications when it’s time to vote and can debate among themselves with messages and threads.

When you reach a consensus, you can automatically set Jira tickets to the corresponding estimate and move on to the next task. This saves time and keeps all team members in sync, even if they are working remotely.

2. Three-point Estimate

The three-point estimate technique provides a range of possible outcomes for a user story or task by considering three values—the most likely, optimistic, and pessimistic estimates. The idea here is that you can counter people’s natural tendencies toward either pessimism or optimism by forcing them to consider all three scenarios.

How it works: 

To use the three-point estimate, team members identify and provide three estimation values for a user story or task from the backlog:

• Most likely estimate: The “most realistic” scenario.

• Optimistic estimate: The best-case scenario.

• Pessimistic estimate: The worst-case scenario—everything that can go wrong (within reason) has gone wrong.

These three estimates are then used to calculate the expected estimate using the following formula:

• Expected Estimate = (Optimistic Estimate + 4 × Most Likely Estimate + Pessimistic Estimate) / 6

So, let’s say our team is working on a user story or task from the backlog that involves creating a new feature for our website. One subtask might involve designing the layout for the new feature. 
Our team members may estimate this as follows:

• Most Likely Estimate: 4 hours
• Optimistic Estimate: 2 hours
• Pessimistic Estimate: 16 hours

Using these values in the formula, we can calculate the expected estimate for this subtask to be approximately 5.67 hours.

3. Affinity Grouping

Affinity grouping is a technique where backlog items or tasks are grouped into rough categories based on their complexity. This is usually a preliminary estimation technique since you don’t end up with very accurate results.

How it works: 

You start with a large list of backlog items or tasks (it helps to display them visually on a digital or physical whiteboard). You then start to move items around on the board, grouping them together based on their complexity. This can be done by a team or individuals within the team.

A key point here—you don’t need to give the groups names or concrete estimates for this technique to work. If that impreciseness bothers you and you find yourself wanting clearer categories, check out the bucket system below. 

It may be more your speed.

4. Bucket System (or T-Shirt Sizing)

The bucket system is a popular estimation technique that’s almost identical to affinity grouping with one big exception—each category has a concrete time estimate associated with it. The categories are often represented as buckets or t-shirts, hence the alternate name.

How it work:

Setup is identical to affinity grouping—add all your tasks to a virtual or physical whiteboard. 

Then, have the team debate to pin down 3–4 categories that make sense to them. These categories are usually framed as “small”, “medium”, and “large” or represented by t-shirt sizes (XS, S, M, L, XL). Once the categories have been established, the team assigns a time estimate to each one based on their understanding of the work involved.

For example, if a task is categorized as “small”, the team may assign it a time estimate of 1-2 hours. If a task is categorized as “medium”, the time estimate could be 3-5 hours. And for tasks categorized as “large”, the time estimate may be 8+ hours.

5. Dot Voting

Dot voting is a technique for prioritizing items or reaching a consensus on a particular topic within a group. It involves team members voting on options or proposals by placing dots or marks next to their preferred choices.

It’s a great way to quickly get consensus on which items are the most complex, important, or time-consuming (depending on how you prompt voters). 

How it works: 

To use dot voting, follow these steps:

1. Start by brainstorming all possible options or proposals on a digital or physical whiteboard.

2. Explain the rules—are team members putting dots next to the most difficult items? The most important? Be clear here.

3. Give each team member a set number of dots (usually 3-5) and have them get started.

4. Once everyone has placed their votes, tally up the results for each item.

The items with the most votes are generally seen as being the most important, complex, or time-consuming. This can help prioritize tasks and determine where to focus efforts.

6. First of Five

First of Five is used to quickly gauge the relative complexity or effort of user stories or tasks. It involves team members voting on the perceived complexity of each item using a scale of one to five, with the first option chosen representing the lowest complexity and the fifth option representing the highest.

How it works: 

This is a pretty simple and straightforward technique. 

Start by gathering all the user stories or tasks that need to be completed for a project. Then, have each team member vote on the complexity of each item using the First of Five scale. Once everyone has voted, tally up the results and use them as a guide for prioritizing tasks and allocating resources.

Conclusion

There you have it—our comprehensive list of the best agile estimation techniques. 

While there are others out there, these are the techniques that we have found to be the most effective and easy to implement. Find one that makes sense to you and give it a try, keeping tabs on how well your estimates line up with real-world outcomes.

And if you’re looking for a way to make Agile estimation async, consider Teaminal. Our async Agile meeting platform includes features for planning poker, backlog refinement, daily standups, retros, and more—perfect for remote Agile teams.

Get started for free today!