If you’re a marketer today we hope you like roller coasters. Because whether you like it or not, you’re essentially riding one. Budgets are being tightening, competition is increasing, AI is changing the game, and it all seems to be happening faster than ever.
One of the most effective ways to manage all this chaos is Agile capacity planning. It helps make work more predictable, reduce stress, and make teams significantly more effective overall.
On the other hand, neglecting capacity planning can gradually undermine your team’s effectiveness. Being overworked can lead to frustration, disillusionment, high turnover, and even health problems, leading to more sick days.
Our latest State of Agile Marketing Report found that Agile teams were far more likely to use estimation and techniques like planning poker. The teams that did were also more than 3x more likely to describe themselves as “extremely successful.” One survey respondent put it this way:
“I have regained work-life balance using velocity and capacity for prioritization. We have come a long way in focusing on value and outcomes rather than a sugar-like addiction to volume, and it' s important to me that I am doing the right work at the right time and not burning myself out doing it.”
But what can you do to nail Agile capacity planning and unlock all those benefits? Our short guide will walk you through everything you need to know to get started.
Whether you're a Kanban practitioner, a Scrum devotee, or just a marketer new to Agile, it’s worth taking a moment to look at just what Agile capacity planning is.
At its core, it’s simply about determining how much work your team can reasonably expect to complete during a set period of time. Ideally you won’t end that set period with tons of leftover work. But you also don’t want to finish 100% every time (more on that later).
Nailing Agile capacity planning lets you improve relations with stakeholders (who will appreciate the greater predictability), manage work and stress levels on the team, and plan more effectively.
We can break Agile capacity planning into three stages:
Whether you work in sprints is an important factor. Because Scrum is broken up into sprints, capacity planning is already an essential step. So when it comes to Kanban or hybrid approaches that don't break work into sprints, how does capacity planning work?
Because Kanban work isn't typically broken into sprints, the best way to incorporate capacity planning is by using time periods like weeks, months, or quarters instead. You'll then follow the three steps outlined above.
One key difference is that you'll be looking to improve throughput – or how much work you can get done during those periods. Ideally, the Kanban software you use can automatically calculate this for you. Over time, you'll want to optimize your throughput while avoiding overburdening any team members. It's a careful balance, but the advice below will help.
As we mentioned in the intro, bad capacity planning tends to make us Agile marketers miserable. We can't function properly when we're stressed about deadlines, overburdened, and unable to adapt flexibly to changes. That translates into burnout and high turnover, hurting team morale, culture, and effectiveness.
One of the key benefits of Agile is its ability to distribute work in an optimized way to help prevent these problems, so poor capacity planning deprives you of that benefit. On the other hand, nailing capacity planning translates into productive marketers who have a balanced workload and are ready to shift gears when necessary.
When your team gets good at Agile capacity planning, you can add some predictability to even the toughest marketing environment. Team members know what’s expected of them, they can plan their work and personal lives around those expectations, and the entire team gets a chance to collaborate and improve together.
Team members also feel like their team and organization is listening to them when they are overcapacity. That helps build more trust, and psychological safety, crucial building blocks for truly effective Agile cultures.
Before proceeding to learn how to plan Agile capacity, why don't you take a second to grab our latest State of Agile Marketing Report?
Whether you’re already trying to do Agile capacity planning or are brand new, it’s worth looking through these steps to better understand the process. It’s always possible you’ve missed something crucial that’s hurting your ability to estimate effectively.
As mentioned, capacity planning requires setting aside a specified amount of time and defining your units of work. Let’s break each down individually.
The time period is fairly simple. In most cases, it’s just a sprint. But if you don’t work in sprints, just determine what time period works for you. We recommend a few weeks because longer periods reduce the chances you have to measure, iterate, and improve.
Setting a “unit of work” is a bit more tricky. Obviously not all work items are equally difficult. Some are tough to estimate while others require complex dependencies. The first thing to understand is that the goal here is NOT to ensure every work item is perfectly sized. Perfection is never going to happen and it’s fortunately not necessary for success here.
Fundamentally, what you’re doing is estimating how much time it will take to complete a work item. Unfortunately, most people are just very bad at estimating time; often, the first step is simply realizing that reality.
The good news is that there are proven strategies, like planning poker, that help make teams much more accurate. Planning poker is a game that has been studied by researchers who found that it markedly improves teams' ability to accurately estimate how much time a task will take.
Using planning poker will enable your team to gradually improve its accuracy over time, better enabling you to hit previously mentioned capacity targets.
Once you’ve got a time period and a way to measure units of work it’s time to assign for the first time. It’s very important that when you do this you don’t aim for 100% capacity.
Trying to have marketers run at 100% capacity as often as possible does not mean you're making them 100% efficient. In reality, it means you're burning the candle at both ends and actually making your marketers less effective. This is the single biggest mistake most teams make when it comes to capacity planning.
100% utilization should be reserved for real emergencies! If you have a "real emergency" every week, that's something that needs to be addressed separately.
So, how much utilization is appropriate? In our experience, the 60-80% range is ideal, depending on the person's experience level and how much they can reasonably handle. At this level, people don't feel useless or underutilized, but they also don't feel overburdened. It's a nice “goldilocks level” that enables people to operate at their best in most situations.
Again don’t worry if you don’t get this right at the beginning. Agile capacity planning is all about continuous improvement, so as long as you’re learning and improving things are going well.
Once you’ve finished your first sprint or equivalent it’s time to pause, take stock, and see how you did. This involves two elements. First is seeing how many of your work items were actually completed. Again if this is 100% then you should definitely try assigning more next time. If it’s more like 50% you should absolutely look at taking on less work next time. Ideally you’ll be getting nearly all of your work done each time, but it’s never going to be perfect.
The second thing to evaluate is how team members feel about their workloads. Ideally, at the end of every sprint or in occasional retrospectives, you'll ask everyone on your team how their workload was during the most recent sprint, week, month, etc. After all, you can have an excellent sprint where you completed 90% of your tasks, but if one team member feels absolutely buried while another has little to do, you’ve still got a problem.
That’s why every once in a while, it's vital to take time to check on how your capacity planning is functioning. Otherwise, you have no idea whether your team members are operating at 40% or 100%.
Sure, you can guess, but actually asking is important because capacity isn't solely about metrics. It's also about how people feel. One person's 90% may be another person's 60%. This is why it’s so important to take time in retros to ask everyone about their capacity. Consider doing this anonymously – ahead of time. That way, people have some time to think about their answers, which can help them avoid feeling embarrassed in front of colleagues if their utilization is low.
Perfection is not the goal because it’s impossible. The world of modern marketing is simply too chaotic for any Agile capacity system to be “perfect.” You’re going to need to embrace continuous improvement. That means experimenting and iterating on your process.
That may mean changing how you estimate work items, how you gather feedback on capacity, or even the tools you use to measure velocity. It’s important to regularly pause, take stock, and see what can be improved. Otherwise, your processes can fall prey to entropy, gradually becoming less and less effective.
Whether your team is used to traditional capacity planning or has been Agile for years, there are a few challenges that are likely to pop up. Here’s what to keep an eye out for and how you can tackle each one.
If your team has workloads that change dramatically based on the season or even at random (the CEO randomly decides they want a major new campaign in two weeks kind of stuff) that can make Agile capacity planning far harder.
While there’s no silver bullet here, there are some ways to help. First, Agile teams should have leaders that are empowered to push back on unplanned or unreasonable work to protect their teams. Essentially, if leaders want the benefits of Agile, they can’t treat their teams like traditional ones ready to drop all their work immediately. Instead, new work requests should always wait for the next sprint or work period to enter the backlog.
Seasonality on the other hand is something you just need to plan for. That might mean minimizing non-essential work during that time, ensuring vacations don’t happen then, etc. This is another thing you can test and iterate on to see what best helps your team handle their shifting workloads.
Another thing that can really throw a wrench in the works of Agile capacity planning is cross-functional dependencies. This is when tasks require work from people or teams outside your own, adding a ton of unpredictability into your work.
Ideally, the way you solve this is by making your teams cross-functional themselves. This is when your team contains all the people and skills required to do its work, meaning you don’t need to rely on externals at all. When that’s not possible, structure goes a long way. This might mean setting up a kind of contract called a Service Level Agreement (SLA) laying out expectations for both sides.
For example, your SLA might specify that the design team needs 2 working days notice to get a particular type of task done. By being specific and binding about what needs to happen, your team can create far more predictability around external work. This makes estimation far easier.
Within teams, you can also use Service Level Expectations (SLEs) to lay out how long particular work items should take to complete internally. Likewise, this expectation can create clarity within a team and help external stakeholders better appreciate how long work may take. Together SLAs and SLEs can help minimize the cost of cross-functional dependencies on Agile capacity planning.
This challenge gets back to leadership again. If you’re not prioritizing the right work, then Agile capacity planning isn’t going to be very useful. After all, being exceptionally good at doing the wrong work isn’t exactly going to move the needle. Leaders need to ruthlessly prioritize the work in the backlog to ensure that when Agile capacity planning happens, the most important work is what gets done.
Agile capacity planning is the process of figuring out how much work can and should be done in a specific time. It factors in strategic priorities and internal capacity to find a balance that ensures work is sustainable and effective.
While you can simply ask team members about their capacity, the best way to calculate team capacity is through trial and error. Try assigning work for a sprint and see how much gets done. Then ask team members whether they felt over or under capacity. Then just adjust based on the results and continue to test.
The five steps of traditional (non-Agile) capacity planning are: forecasting demand, determining the capacity needed to meet that demand, calculating the internal resources of your team, measuring the gap between your resources and what is needed, and finally figuring out how to align your capacity with that demand.
The best capacity planning tool will vary depending on whether your team is Agile, how much customization you need, etc. In general though, you can do capacity planning through any project management tool. The best approach is typically to stick with what you’re already using.
Because Kanban doesn’t break work into sprints, capacity planning can be tricky. It’s best to either try a hybrid approach that adds sprints or to simply estimate capacity for set periods of a few weeks. From there you can follow the traditional Agile capacity planning steps.
Effective Agile capacity planning is an essential part of Agile success. It enables teams to unlock a wide range of critical Agile benefits, from psychological safety and experimentation, to lower stress levels and reduced burnout. Teams become more effective, work becomes more predictable, and stakeholders are happy.
But like with all things Agile, maintaining these benefits requires a laser-focus on continuous improvement. Too often Agile teams atrophy, drift back to non-Agile ways of working, and generally become complacent. That results in teams losing all these benefits they worked so hard to achieve.
The question then is: how can your teams access continuous Agile training, coaching, and inspiration without racking up huge bills in the process? We set out to solve that exact problem, building a single product that gets you access to a massive library of microlearning, monthly live coaching, quarterly workshops, self-paced training, a custom-build AI bot to help you on your Agile journey, and more. We call it The Edge and it’s ready to transform how your teams operate.