Matt Jukes has written a post called Don’t do Agile. Be agile. Or something. where he describes how estimating stories has not worked for them at the Office of National Statistics.
I think there is a more important reason to do estimation that just release planning, and that’s people management.
Over time, estimating allows you to create a sprint which is neither too daunting nor too trivial, and to build a good team cadence. A sprint with too much work in it can be depressing and ultimately slow down delivery, a sprint with too little runs the risk of falling foul of Parkinson’s law.
You could argue that if you have a good, committed team who are always up for the challenge of whatever’s put in front of them then it doesn’t matter – I’d argue the opposite and that you’re at risk of burning out your team.
Velocity, paired with your observations of the team, will give you the data to be able to work out if they are maintaining a sustainable pace or not.
As much as I am not a fan of Pivotal Tracker, it’s taught me that the burndown is not as important as having a graphical view onto historical velocity. Did the team deliver fewer points this sprint? Why? Was it story-related or human-related? If their velocity has been solid and steady for a long time, are they ready to step up, or do they need a rest? Most managers have a gut feel for these things, but having the data to be able to back it up makes it easier to discuss in retrospectives and planning sessions.
Estimation is not always easy, but so long as you don’t put too much importance on getting the “right” estimate, and so long as it’s really treated like an estimate, it can be extremely valuable for both release planning and maintaining the long-term health of your team.