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Calculating Velocity

With this graph you can see how velocity changes over time

Once a development team knows its velocity, it can predict almost exactly how many user story points it can work on in the next sprint. But how can velocity be calculated and which definition best explains the velocity feedback tool? In this article, we’ll clarify all the important details about velocity and show you how to calculate velocity and measure its change.

Definition of Velocity and what it means in an agile context

Velocity measures the amount of work a development team can do during a sprint. Accordingly, it is also a measure of the speed of a development team and thus a key performance indicator within the Scrum framework.

Measuring Velocity: That’s how it works

Calculating the Scrum velocity of a development team is actually very easy. Everything you need to do:

At the end of the sprint, add the points of all user stories delivered by the development team.

An example for the calculation of a team’s velocity

A development team commits to work on the following User Stories in the next sprint:

  • Story A: 3 points
  • Story B: 5 points
  • Story C: 8 points

The team completes the stories A and C in the sprint, but only manages to complete 80% of story B and thus can’t declare it “done”. Therefore, only the points of the stories A and C will be taken into account for the velocity of this sprint. This means that the velocity of the team for this sprint is 11.

3 Tips for the calculation of a team’s velocity

The following three tips for calculating the velocity will be helpful for you and your team:

  1. Measure the velocity already throughout the sprint.
  2. Note the points of done user stories on the Sprint Burndown or Sprint Burnup Chart.
  3. Make sure that this chart is clearly visible for all Scrum Team members at all times.

Measuring how the Velocity changes over time

If you want to measure how the velocity changes over time in order to draw conclusions and make predictions, make a diagram with the velocity of the respective sprints: put the individual sprints on the horizontal axis and the respective velocity on the vertical axis. Of course, the velocity of a team will fluctuate especially at the beginning. However, with a well-functioning development team you can expect a constant increase in velocity in the medium to long-term.

What is the calculated Velocity good for?

These are the biggest benefits of velocity as a performance indicator in an agile context:

  • The performance of a development team can be measured.
  • The development of the team itself can be made visible and is thus a valuable feedback tool.
  • By looking at the regularly measured velocity a team knows whether changes in the work processes have helped or not. Thanks to the insights gained from a change in velocity, the development team can improve.
  • Velocity simplifies sprint planning by allowing you to predict how many user story points the development team can edit or deliver. The average of the last three to five sprint velocities should be used for sprint planning.
  • With well-established, stable development teams the velocity can be used for longer-term product development forecasts.
  • Velocity helps the product owner when it comes to release planning because it allows the product owner to calculate relatively precisely how many sprints a development team needs in order to deliver a product with the desired level of functionality.

The 3 biggest No-Gos regarding Velocity

You and your team should always try to take the following points into account and thus avoid the three most common mistakes when calculating the velocity:

  1. Never take into account the points of unfinished user stories or bug fixes!
  2. Never calculate the velocity of individual team members – only do so for the whole team! Velocity is a team metric!
  3. Never use the velocity for giving bonuses or other rewards to the team! This will lead to story point inflation as the team is likely to underestimate their user stories to achieve higher scores.

Do you need more infos about Scrum?

In our Scrum dictionary we have gathered the most important terms from the agile world of work and the Scrum Guide will give you a solid understanding of the entire Scrum framework, its advantages and possibilities. Any questions about Scrum? Contact us and we will see what we can do for you.