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What is the velocity of an Agile scrum methodology?


Let's discuss some of the important measurements in Agile, and that is the Velocity of the Scrum team work.
Based on Wikipedia definition Velocity is " ...the rate of change of its position with respect to a frame of reference and is a function of time...", which when transferred to the scrum world can be summarized as: The amount of work that the scrum team completed in a single measure of time - in a sprint.

How we Calculate Velocity?
Velocity is actually a very simple to calculate, it is done but totaling the number of story points of fully completed user stories from the sprint backlog. So if a current sprint included 4 user stories: 2 with 8 story points each, one with 3 story points and one with 32 story points. and by the end of the sprint the 32 one was not fully done the velocity calculation will be:
8+8+3=19
Note: the 32 story points are not part of the velocity calculation as this user story was not completed.

What Velocity is used for?
The velocity is used in Agile to estimate the team work and measure its success, that usually is done in a Velocity Chart:

Such chart is used to estimate how much work (story points) are completed during each sprint, and to indicate the expectations from the scrum team.
Usually new to Agile are concern how to built this chart before the work begins and the recommendation here is to estimate for 1/3 of the maximum capacity of the team. If a developer confident that he can complete 32 story points in a sprint, for the first sprint I suggest to assign no more that 13 story points to such developer and adjust the  estimated velocity as required after real velocity is calculated.

Velocity Chart also feeding data into iteration Burndown Charts which is another important metric for a scrum team.

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