Planning poker is a consensus-based technique for estimating user stories in Agile product development. It involves the following steps:

Steps of Planning Poker in Agile

The product owner presents a user story to the team from the product backlog. The story represents a functional requirement needed in the product.
Each team member is given a deck of planning poker cards with values like 0, 1, 2, 3, 5, 8, 13, 20, 40, 100. These values represent story points – an abstract measure of effort.
After discussion, each member privately selects a card representing their estimate of the story’s size/effort. Cards are kept hidden.
Once everyone has chosen a card, the estimates are revealed simultaneously by each member.
If estimates differ significantly, the high and low estimators explain their reasoning. Discussion continues until the team converges toward a consensus estimate.
The consensus reached becomes the story point estimate for that user story. The estimate represents the relative level of effort needed to complete the story.
By discussing each other’s estimates, the team aligns on a shared understanding of the work involved. Over time, velocity emerges – the rate at which the team completes story points.

Planning poker provides a collaborative estimation process that leverages the team’s collective knowledge to size PBIs/user stories. The discussion and consensus help minimize individual biases in estimation. It results in reliable velocity forecasting. Let’s get into more detail about Planning poker in Agile.

What is the meaning of an Estimation Scale?

The estimation scale in the Agile team helps in estimating the relative size of user stories. It is typically a modified Fibonacci-like sequence, such as 1, 2, 3, 5, 8, 13, 20, 40, 100, etc. Planning poker is a game played by Agile teams to estimate the relative size of user stories.

Each player is given a deck of cards, each of which has a number from the estimation scale. The players discuss the story or feature to be estimated, and each player independently selects a card from their deck to represent their estimate. The cards are then revealed simultaneously by all the team members, and the estimates are discussed. If there is disagreement, the players discuss the story again, and each player selects a new card. This process is repeated until there is consensus on the estimate by the team OR the story is kept aside for further clarification.

Why relative estimation?

Before getting into the details of Planning Poker, let’s look at relative estimation. Humans as an individual cannot be accurate; however, humans can relate very well. Hence this reflects at work as well. In the waterfall world, we tried to be very accurate by estimating the tasks in hours, however, it didn’t work.

Hence, in Agile we do the relative estimation. Instead of accurately estimating, it is easy for us to compare and say “B is 3 times bigger than A”, and “C is bigger than A by 5 times”, hence planning poker uses a modified Fibonacci series to estimate the backlog items relatively.

Why is it necessary for the team to host a Planning Poker activity?

One reason a team hosts a Planning Poker activity is to help build a consensus among the whole team in estimating the user story. Getting everyone on the team to vote on the size of the user story can help ensure that the backlog items are sized and used for effective planning.

Who participates in a Planning Poker activity?

A Planning Poker activity involves a group of people who are working on product development together. In an Agile team, the planning poker is involved by the entire team including:

The Scrum Master
The Product Owner
The Development Team

Parameters considered while estimating the user story

Before understanding how to use planning poker for estimating the story, let’s identify the parameters for estimating the story point.
There are 3 parameters involved in estimating the story

Size of the work: how much work is involved in completing the user story?
The complexity of the work: How complex is the work?
Knowhow: How much do I know about what and how to implement?

Each team member considers all the above parameters while estimating each story.

How to play Planning Poker in Agile?

The planning poker estimation technique is played as given in the following steps.

1. The entire Agile Team picks one story that is small, and absolutely not complex, the team has absolute clarity on the know-how of the story as a reference story and marks it as 1 story point.

2.. The product owner presents an item from the product backlog.

3. Each player on the team secretly selects a card from their deck that represents their estimate of the effort required to complete the item.

5. Once all players have selected a card, everyone reveals their card simultaneously.

6. If there is consensus (all players selected the same card), then that is the estimate. If there is disagreement, the players discuss and try to reach a consensus. If they cannot reach a consensus, they select another card.

7. The whole activity is facilitated by the Scrum Master.

What if the team gets into the following scenarios during the estimation process?

Scenario	Estimation
Team of 7 members: 6 members pick 3 story points, 1 member picks 5 story points	3 story points
Team of 7 members: 4 members pick 3 story points, 3 members pick 5 story points	3 story points
Team of 6 members: 4 members pick 3 story points, 2 members pick 8 story points	Re-estimate
The team estimates with different sizes in multiple cycles of estimation	Keep the story aside for clarification
The entire team estimated the story with 8 story points	8 story points
The entire team estimate the story with 20 or 40 story points	If the story is going to be implemented in the near future, then split the story into smaller stories and estimate each one

How can we use this in the online world?

Post-Covid, the situation has changed completely. Teams work remotely to a large extent. How do we use this technique?
There are online Planning Poker tools that the team can use to estimate, for example,

www.Planningpoker.com
www.platitpoker.com
Agile Poker for Jira, etc. These online tools allow everyone to estimate in parallel.

What are the benefits of planning poker in the Agile world?

There are many benefits to using planning poker in an Agile world, including the following:

It ensures that every person on the team is on the same page regarding the backlog’s scope.
Since the whole team estimates using Planning Poker, the team’s differences are sought out during the estimation. The team gets a common understanding of the backlog. If there are any differences, then it comes out clearly.
Since the estimation is done by the whole team after the agreement, the estimation can be very close to reality. The chances of them going wrong are minimal.
Since team estimates, it enables the ownership culture to understand, estimate, plan, and deliver the story.
Planning poker helps estimate the stories, not tasks. Hence it builds some level of credibility with the stakeholders as they understand the stories well.
Story point estimate even helps Product Owners prioritize better. For example, if Story A has 13 story points and Story B has 3 story points, PO has the option to prioritize B over A so it can be delivered faster.
The team estimates simultaneously, hence it allows everyone to explicitly call out their understanding of the backlog item. It eliminates bias.

Conclusion:

Planning Poker is one of the widely used and very effective estimation techniques in Agile product development. Teams understanding the Planning Poker technique is key to the estimation, planning, and effective execution of the product.