Stories and Story Points

What Are Stories and Story Points in Agile Project Management?

What Are Stories?

In Agile, a user story is the smallest unit of work, describing a feature or requirement from the perspective of the end user or customer. Rather than specifying technical details, a user story focuses on what the user needs and why, using simple, non-technical language. The goal is to articulate how a piece of work will deliver value to the customer, whether that customer is external or internal to the organization.

Example of a user story:

“As a customer, I want to reset my password so that I can regain access to my account.”

Stories are the building blocks of Agile work. They are added to the product backlog, prioritized, and selected for delivery in sprints or workflow cycles.

What Are Story Points?

Story points are a unit of measure used by Agile teams to estimate the overall effort required to complete a user story or backlog item. Unlike time-based estimates (hours or days), story points are relative and abstract—they capture the amount of work, complexity, risk, and uncertainty involved in delivering a story.

Story points help teams:

Compare the effort required for different stories.
Plan how much work can be completed in a sprint (team velocity).
Focus on the difficulty and unknowns, not just the time involved.

Why Do We Assign Story Points to Stories?

Assigning story points serves several important purposes:

Improved Planning and Forecasting: Teams can better plan sprints by understanding their capacity in terms of story points, not just tasks.
Relative Estimation: Story points allow teams to compare stories against each other, making it easier to break down large work items and spot when a story is too big.
Reduced Emotional Bias: Estimating in points removes the emotional attachment to deadlines and avoids the pitfalls of time-based commitments.
Team Alignment: The process encourages team discussion, leading to a shared understanding of the work involved.
Adaptability: If team composition changes, velocity (average points completed per sprint) can be adjusted without recalculating time estimates.

How Do You Assign Story Points to Stories?

Story points are assigned collaboratively by the team, usually during backlog refinement or sprint planning. Here’s a common step-by-step approach:

Review the Story: The team discusses what the story is about, clarifies requirements, and identifies any unknowns.
Consider Key Factors:
Amount of work involved
Complexity of the task
Risk and uncertainty (unknowns, dependencies, possible blockers)
Repetition (team’s experience with similar tasks)
Compare to Reference Stories: Teams often use a baseline story (e.g., a simple story assigned 1 point) and compare new stories to this baseline to determine if they are more or less effort.
Use a Relative Scale: Most teams use the Fibonacci sequence (1, 2, 3, 5, 8, 13, etc.) to reflect increasing uncertainty and effort for larger stories.
Estimate Collaboratively: Techniques like “planning poker” are used, where each team member privately selects a point value, then the team discusses differences and reaches consensus.
Adjust as Needed: If a story is too large (e.g., more points than can be completed in a sprint), it should be broken down into smaller stories.

Examples

Best Practice

Don’t fix story points to hours globally. Let your team’s velocity and experience guide you.
Use story points for planning and forecasting, not for micromanaging time.
If you must estimate hours, do it as a separate exercise for reporting or budgeting, but keep story points for Agile planning.

1. Human Resources (HR) Onboarding

User Story:

As a new employee, I want to receive a welcome package on my first day so that I feel valued and have the materials I need to get started.

Assigning Story Points:

Effort: Preparing the package, coordinating with admin, delivering it on time
Complexity: Low (routine process)
Uncertainty: Minimal
Estimated Story Points: 2 (relatively simple, but requires coordination)

2. Marketing Campaign

User Story:

As a marketing manager, I want to segment our email list by customer interests so that we can send more targeted and effective campaigns.

Assigning Story Points:

Effort: Analyzing data, creating segments, updating email lists
Complexity: Moderate (depends on data quality and tools)
Uncertainty: Some (data accuracy, tool limitations)
Estimated Story Points: 5 (more complex and time-consuming than onboarding)

3. Finance – Expense Reporting

User Story:

As a department head, I want to receive a monthly summary of expenses so that I can monitor and control our budget.

Assigning Story Points:

Effort: Gathering data, formatting the report, sending it out
Complexity: Low
Uncertainty: Minimal
Estimated Story Points: 2 (straightforward, recurring task)

Activity

Refer to the Agile Workbook for the Activity

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