Evaluating When To Use Story Points Versus Hours For Estimation

What are Story Points and Hours?

Story points are a relative measure of the estimated complexity or effort required to implement a user story or feature in an agile software development process. Rather than estimating the actual time something will take, story points rate items on a scale to indicate how difficult the work is compared to other items.

A common scale is the Fibonacci sequence (1, 2, 3, 5, 8, etc.). Teams assign higher story point values to items they believe will require more work than items with lower values. Teams determine what a story point means to them and maintain consistency in how points are awarded.

Hours, on the other hand, refer to a direct measure of time estimated for a particular task. They aim to quantify exactly how long the work will take by estimating the number of hours assigned for design, development, testing, and other activities.

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When Should You Use Story Points?

Story points are best used early in the development process when the level of uncertainty is high. They help estimate the overall size of work when details are not yet well-defined. As understanding increases, hours can then supplement story points to estimate tasks.

Points are also useful when comparing the relative sizes of user stories. Two related stories may be awarded 5 points and 3 points respectively to indicate one story is larger than the other. The specific amount of time is not vital when simply attempting to identify larger and smaller pieces of work.

In addition, story points track a team’s velocity – how much work they complete in each sprint. This velocity is used for release planning and to predict how much work can be finished in upcoming iterations. Hours don’t factor into velocity calculations. Tracking points completed rather than hours worked keeps the focus on forecasting using past performance.

When Should You Use Hours?

Hours are best utilized when the requirements and scope of work are clearly defined. Once user stories are broken down into well-understood tasks, developers have enough knowledge to estimate time accurately. These hour estimates are specific to the work details.

Estimating hours is also useful for tracking the actual development time spent completing tasks. While velocity tracks the rate of completed story points, hours measure the real-world time invested in delivering working software. This aids in capacity planning – teams know how much effort remaining work will require.

Lastly, estimated hours contribute to resource allocation decisions. Managers can identify workload distribution across the team and shift tasks based on hours estimates and individual availability. Story points themselves do not factor into assigning work among team members.

Story Points to Hours Conversion Challenges

While story points quantify the relative size of items and hours represent actual time worked, converting between these units is problematic:

By definition, story points purposefully represent a range of effort using arbitrary values rather than precise measurements. Hours try to pinpoint work times accurately.
A team’s velocity affects how many story points it completes per sprint. Higher velocity means more points finished. So story point values are tied directly to a team’s unique performance rather than strict time spent working.
Scope creep often results in more actual hours spent than initially estimated if requirements change or new work appears mid-sprint. However, the completed story point values typically do not change. So hours increase without affecting points.

In essence, story points and hours measure different attributes on independent scales not easily reconciled.

Best Practices for Using Both Together

Despite their differences, utilizing both story points and hours in tandem enables effective software estimation at multiple levels of precision:

Initially estimate overall work effort and complexity in story points during product backlog grooming. Points quantify large components before implementation details emerge.
When preparing to complete story point work during a sprint, break it down into granular tasks defined and estimated directly in hours. These hours calculate expected sprint capacity.
Over the course of the sprint, track both the completion status of overall story points plus recorded hours invested per task. Review for accuracy.

This multidimensional tracking ties higher-level points to lower-level hour estimates, measuring software delivery from different angles: output through story completion and input via allocated effort in hours.

Key Takeaways and Recommendations

In summary, story points excel at comparing relative effort when uncertainty is high, while hour estimates work best for well-defined tasks requiring detailed resource allocation:

Use story points early on for sizing and forecasting using historical velocity based on point completion rates.
Switch to hours later for capacity planning and precise team assignments as technical requirements become clear.
Regularly assess deviations between hours expended and points done to improve accuracy.

Neither method alone meets all tracking and estimating needs. Employ both in a “points to hours” approach throughout the agile process to reliably meet sprint commitments.