The Hidden Danger using Effort in Estimation: What You Need to Know for Better Forecasts!

Find out how to improve consistency in estimations

When building products, teams often need to estimate the size and scope of a job. They may use relative estimation techniques like story points to do this, but a common problem can arise when they use effort as the basis for comparison. Effort is essential to completing a job, but it can change over time depending on factors like experience, skill level, and technology, leading to inconsistent and inaccurate estimates that make it difficult to forecast work timelines.

To understand the problem, let's take the example of building a brick wall using 10,000 bricks. The job's size is fixed, but the rate of work can vary depending on the bricklayer's skill level. A novice bricklayer may need more effort to lay the bricks, while a master bricklayer may require less. However, the job's size remains the same, regardless of the effort required.

Using effort as a basis for estimation can lead to inaccurate job sizing since effort can vary over time. For instance, if a team starts a new job using new technology and begins learning new skills, the initial effort required may be high, leading to an overestimation of job size. As the team's proficiency increases, the effort required to complete the job decreases, and the job's size may be underestimated.

Relying on effort for estimation defeats the purpose of relative estimation, which aims to establish a common basis of comparison independent of specific skills or team members. It also undermines the purpose of velocity, which provides a consistent measure of how quickly the team can deliver value.

When estimating the size of a job, teams should aim for consistency in job size and allow the work rate to vary over time. This approach yields a more accurate and consistent estimation process, which is essential for better resource planning, risk management, and forecasting, ultimately leading to successful product outcomes.

In conclusion, relative estimation is a useful tool when building products that brings consistency to job sizing. However, using effort as a basis for estimation can cause inconsistencies in sizing over time. Instead, teams should focus on establishing a common basis of comparison independent of specific skills or team members to achieve more accurate and consistent estimation, leading to better product outcomes. Focus on sizing the job not the effort.