Stochastical Size Estimation in AGILE Estimation

 Recently I was working on a project as a Scrum Master and we had to estimate a project with multiple unknowns.

I recalled the Stochastical Duration Estimation technique that I had learned some year back when training at UCSC-extension in Santa Clara. The course I was in was 'Project Integration and Risk Management'.

With duration being more difficult to estimate than T-shirt or story point sizes, the approach can be applied to T-shirt or Story Point sizes as well.

The technique assumes the 6-point estimation for Task Estimation TE or 

O=Most optimistic estimate

M=Most likely estimate

P=Pessimistic estimate

Task Estimate TE = (O + 4*M + P)/6

Variance V = (P-O)^2/36

A Statistical table provides a Z value for Confidence or Probability of Occurrence.

Confidence Level/Probability    Z-value

50%                                            0

75%                                            0.67

90%                                            1.28

100%                                          3.49

Size Estimation S = TE + Z*SQRT(V)

For Project or multiple tasks,

Size Estimation S =  SUM(TE) + Z* SQRT(SUM(V))