This is basically the comtent of a comment I made in response to the Cost (and Schedule) Estimating Foundations post by Glen B. Alleman in his blog. As usual, it is spot on.
I have now seen a couple of Agile projects unfold and one of the challenges they face is the accurate estimation of story points (SP).
On a project that has hit its stride, with no particular challenges, I witnessed the number of SPs achieved on two consecutive sprints fall to half the estimated SP/sprint and then to one tenth estimated SP/sprint. Of course the effort and budget expended did not go down at all.
Either the development team suddenly went stupid (unlikely) or the failed to assign the right amount of SPs to the tasks. There are many ways this second scenario unfolds, but the most likely is that the team got a bit full of itself and estimated down the effort required. A fixed amount of people can produce only a set amount of work (SP) per amount of time (sprint) hence the weird results.
Apparently the so-called iron triangle applies to Agile too.
What do you think? As always questions and comments are welcome.
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