While most work estimates are inaccurate, there are things you can do to help improve your team’s estimation techniques. For example, one simple method creates “estimating buckets” where user stories are ranked by their complexity:
The key is to make sure no item is estimated at in between the buckets. For example, a six hour estimate would fall into the eight hour bucket and therefore would have an 8-hour estimate. This system provides leeway for items that are occasionally over or underestimated.
Regardless of whether you use hours or story points for your estimations, be sure to maintain the same unit for all estimations. Remember that in Scrum, the estimates are only part of the story—burndown velocity is the true indicator of whether or not a project is on track.