- Your “effective velocity” is your usual calculated velocity less “creep” – the amount of work that gets added to the backlog each iteration, whether that’s due to feature creep or to new bugs that go unfixed. Just as with conventional measures of velocity, you should be able to obtain this from your historical data.
- A contingency of 2 standard deviations, measured in iterations. Added to the number of iterations required to complete the release steadily at the effective velocity, it gives a timeframe that should be sufficient 95% of the time.
I’m keen to hear how other managers of agile/iterative projects approach contingency. For my next release, I aim to plan the critical functionality and use the calculated contingency as an estimate of the effort available for non-critical work. As the project progresses, this estimate changes according to how well development progresses; only if things go really badly (bottom 5% badly!) do dates need to change.
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UPDATE: See also the companion Wiggle Room Calculator