You’re sitting in an executive board meeting, and the discussion shifts to Agile team performance. A senior leader turns to you and asks:
"We’ve been tracking team velocity across multiple squads. How do we ensure it’s improving quarter over quarter?"
This is the moment you take a deep breath. You know that velocity is one of the most misunderstood Agile metrics—often mistaken for a performance indicator rather than what it truly is: a planning tool.
So, let’s set the record straight.
What Is Team Velocity?
Velocity is the amount of work a Scrum Team completes in a Sprint, typically measured in story points, hours, or completed backlog items.
How Is Velocity Calculated?
Example:
If a team completes 30 story points in Sprint 1, 25 in Sprint 2, and 28 in Sprint 3, their average velocity is ~27 story points per sprint.
This helps in forecasting how much work they can complete in future sprints.
What Velocity Tells You (and How to Use It Effectively)
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Velocity Helps with Sprint Planning
Teams can use their past velocity to gauge how much work they can forecast in upcoming sprints. This prevents overcommitment and keeps sprints realistic.
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Velocity Provides Trend Insights
If velocity drops consistently, it might indicate blockers, team burnout, or shifting priorities. If it keeps increasing, it may mean the team is padding the estimates.
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Velocity Helps in Forecasting Release Timelines
If a product backlog has 300 points left, and the team’s velocity is 30 points per sprint, you can estimate that the release may take approximately 10 more sprints.
What Velocity DOESN’T Tell You (and Common Misconceptions)
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Velocity Is Not a Productivity Metric
A team delivering more story points doesn’t always mean they are adding more business value. If velocity is increasing but product quality is dropping, it’s meaningless.
Better Metric: Measure customer outcomes and delivered value, not just completed story points.
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Comparing Velocity Across Teams is a Mistake
Velocity is team-specific. A team averaging 40 points per sprint is not “better” than one averaging 20. They might be using different estimation methods or have different scales.
Bad Practice: Leadership comparing teams based on velocity and pushing for "higher numbers."
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Forcing Velocity to Increase Can Backfire
Some companies set velocity targets, pressuring teams to "hit 50 points per sprint." Teams may respond by:
- Inflating estimates ("This item is 8 points instead of 5!")
- Rushing work (leading to bugs and rework)
- Ignoring technical debt (accumulating long-term risks)
Better Approach: Focus on outcome-based success—customer satisfaction, cycle time, and value delivered.
The Right Way to Use Velocity in Agile Leadership
DO:
- Use velocity for planning and forecasting.
- Track velocity trends instead of fixating on numbers.
- Address blockers when velocity drops unexpectedly.
- Ensure stories are well-refined so velocity remains meaningful.
DON’T:
- Compare velocity between teams—it’s not a competition.
- Treat velocity as a performance metric—it’s a planning tool.
- Push teams to "increase velocity"—focus on business value instead.
- Use velocity as an executive KPI—customer outcomes matter more.
Final Thoughts: Leadership’s Role in Velocity Management
If you’re an executive, leader, or stakeholder, don’t ask:
“Why isn’t velocity increasing?”
Instead, ask:
“Are we delivering high-value work consistently?”
Need Help with Agile Velocity or Implementation?
If you or your teams are struggling with velocity or agile implementation, please contact us:
Email: support@agilewow.com | Call/WhatsApp: +91-8368865197
