Story points are attached to an estimated user story and used as arbitrary, estimated levels of effort for the product team to complete the user story. Paired with velocity, story points inform product planning. Story points reflect the estimate for the full product team’s work involved with it, including design, development and quality assurance.
Our product teams typically use the point values: 1, 3, 5, 8, 13, and 21. Relative to each product, a “1” may mean a user story is very easy and requires little work. On the other hand, a “21” may signify a large user story that is difficult to implement, requires a lot of work and maybe some research and learning before doing it. A user story that is estimated to be a large amount of work could also be a signal that it needs to be broken down into multiple user stories.
While it may seem that story points are less reliable than hour estimates due to their intentionally ambiguous nature, the opposite is true. Due to the process of software development, hour estimates are historically proven to be unreliable. On the other hand, story points enable teams to use velocity as a tool to more accurately predict and plan for releases. Using story points as the basis for estimation, our agile product teams are able to be much more effective in product release management.