What we should do with a Scrum Team's fluctuating Velocity trends?

Velocity is one of the indicators for a 'stable' Scrum Team used in making better team forecasts. Measuring Velocity and studying patterns over a period of time does make sense when it is the same folks staying together and pull work as a team.

With frequently changing team members, there might be an impact on the Scrum Team's Velocity. But is that the only factor influencing the Velocity of the team? Not necessary.

This blog post is not intended anyways to list down all possible factors affecting the Scrum Team's Velocity. Let us get to focus on what if there is a variance observed in the growing trend of Velocity for a team.

Story points are the building blocks for measuring a Scrum Team's Velocity. At the same time, Story points are a means for a team to get their arms around how much work they can take on. There's nothing to indicate that any of the work was completed to release quality, that valuable Sprint Goals were met, or that any value is being released at all for a Product Owner to optimize with those Story Point completion trends.

Having this understanding about what Story Points do offer, we need to know further on why and who is observing such variations to Velocity.

The policies behind how estimation is done in a Scrum Team determine the flow of information with work getting done.

"The Development Team is responsible for all estimates. The Product Owner may influence the Development Team by helping it understand and select trade-offs, but the people who will perform the work make the final estimate." - The Scrum Guide

The following 'must-have's are called out explicitly to continue exploring this scenario further:

1. The Development Team part of the Scrum Team is responsible for estimating the Product Backlog Items.
2. The Development Team does observe such variations in Velocity and
3. The Development Team do have concern towards how they can infer for forecasting work in the future.

Failing to any one of the above-mentioned conditions creates a different challenge altogether for discussion which is completely out of scope with this blog post.

Make 'Probabilistic forecasting' and not 'Deterministic forecasting' with such fluctuating Velocity trends

A quick call-out of what is deterministic forecasting and how different it is from Probabilistic forecasting is essential at this juncture.

Deterministic Forecasting: A forecast that does not include expression of the associated uncertainty. A forecast based specifically on a given value or range for an area at a given time (e.g., the temperature at morning rush hour or evening commute). This is what we are used to seeing on forecast bulletins and on local news media.

Here we are talking about a system in which no randomness is involved in the development of future states of the system. A deterministic model will thus always produce the same output from a given starting condition or initial state.

Probabilistic Forecasting: A probabilistic forecast takes the form of a predictive probability distribution over future quantities or events of interest. Probabilistic forecasting aims to maximize the sharpness of the predictive distributions, subject to calibration, on the basis of the available information set.

Probabilistic forecasting in this complex domain assumes that there is not a single future. It is the case of many possible futures. In probabilistic forecasting, the output is not one number. Instead, it is a listing of probabilities for all future demands.

And when you understand this concept in a holistic fashion, there should be no more fear or worries looking at that fluctuation in the Velocity trend chart.

Remembering Empiricism:

Empiricism has become the real foundation of modern science and helps to understand better the world we are in. Empiricism actually means acknowledging that there is always a certain level of uncertainty with all that we do. The need is to understand and come to terms with that reality.

"Scrum is founded on empirical process control theory or empiricism. Empiricism asserts that knowledge comes from experience and making decisions based on what is known." - The Scrum Guide

With realization coming from Empiricism on uncertainty in all that we do, less we can expect on the trends around a lagging indicator similar to Velocity other than variations.

Wrap up!

We need to remember the hard fact that Velocity numbers are stochastic by nature and can be at most used only to make probabilistic forecasts for future work. And with such variations become more and more normal, increasing the data points to average and using only as an indicator to make probabilistic forecasts and nothing else can save oneself from inviting big trouble.

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