A decades-long goal has been to find repeatable, predictable processes or methodologies (software engineering) that improve productivity and quality. Some try to systematize or formalize the seemingly unruly task of writing software. Others apply project management techniques to writing software. Without project management, software projects can easily be delivered late or over budget. With large numbers of software projects not meeting their expectations in terms of functionality, cost, or delivery schedule, effective project management is proving difficult.
The best-known and oldest process is the waterfall model, where developers (roughly) follow these steps in order. They state requirements, analyze them, design a solution approach, architect a software framework for that solution, develop code, test (perhaps unit tests then system tests), deploy, and maintain. After each step is finished, the process proceeds to the next step, just as builders don't revise the foundation of a house after the framing has been erected. If iteration is not included in the planning, the process has no provision for correcting errors in early steps (for example, in the requirements), so the entire (expensive) engineering process may be executed to the end, resulting in unusable or unneeded software features.
In old style (CMM) processes, architecture and design preceded coding, usually by separate people in a separate process step.
Iterative development prescribes the construction of initially small but ever larger portions of a software project to help all those involved to uncover important issues early before problems or faulty assumptions can lead to disaster. Iterative processes are preferred by commercial developers because it allows a potential of reaching the design goals of a customer who does not know how to define what he wants.
Agile software development processes are built on the foundation of iterative development. To that foundation they add a lighter, more people-centric viewpoint than traditional approaches. Agile processes use feedback, rather than planning, as their primary control mechanism. The feedback is driven by regular tests and releases of the evolving software.
Agile processes seem to be more efficient than older methodologies, using less programmer time to produce more functional, higher quality software, but have the drawback from a business perspective that they do not provide long-term planning capability. In essence, they say that they will provide the most bang for the buck, but won't say exactly when that bang will be.
Extreme Programming, XP, is the best-known agile process. In XP, the phases are carried out in extremely small (or "continuous") steps compared to the older, "batch" processes. The (intentionally incomplete) first pass through the steps might take a day or a week, rather than the months or years of each complete step in the Waterfall model. First, one writes automated tests, to provide concrete goals for development. Next is coding (by a pair of programmers), which is complete when all the tests pass, and the programmers can't think of any more tests that are needed. Design and architecture emerge out of refactoring, and come after coding. Design is done by the same people who do the coding. (Only the last feature - merging design and code - is common to all the other agile processes.) The incomplete but functional system is deployed or demonstrated for (some subset of) the users (at least one of which is on the development team). At this point, the practitioners start again on writing tests for the next most important part of the system.
While Iterative development approaches have their advantages, software architects are still faced with the challenge of creating a reliable foundation upon which to develop. Such a foundation often requires a fair amount of upfront analysis and prototyping to build a development model. The development model often relies upon specific design patterns and entity relationship diagrams (ERD). Without this upfront foundation, Iterative development can create long term challenges that are significant in terms of cost and quality.
Critics of iterative development approaches point out that these processes place what may be an unreasonable expectation upon the recipient of the software: that they must possess the skills and experience of a seasoned software developer. The approach can also be very expensive, akin to... "If you don't know what kind of house you want, let me build you one and see if you like it. If you don't, we'll tear it all down and start over." A large pile of building-materials, which are now scrap, can be the final result of such a lack of up-front discipline.
Formal methods are mathematical approaches to solving software (and hardware) problems at the requirements, specification and design levels. Examples of formal methods include the B-Method, Petri nets, RAISE and VDM. Various formal specification notations are available, such as the Z notation. More generally, automata theory can be used to build up and validate application behaviour by designing a system of finite state machines.
Recent approaches try to merge the specification and code into one activity to ensure the specification and code match. While Agile methods propagate specification of all requirements in code, methods such as VFSM develop executable specifications, trying to avoid the coding activity entirely