In 1970, Dr. Winston Royce presented a paper entitled “Managing the Development of Large Software Systems”, which criticized sequential development. He asserted that software should not be developed like an automobile on an assembly line, in which each piece is added in sequential phases. In such sequential phases, every phase of the project must be completed before the next phase can begin. Dr. Royce recommended against the phase based approach in which developers first gather all of a project’s requirements, then complete all of its architecture and design, then write all of the code, and so on. Royce specifically objected to this approach due to the lack of communication between the specialized groups that complete each phase of work.

It’s easy to see how the “waterfall” methodology is far from optimized compared to agile methodology. First of all, it assumes that every requirement of the project can be identified before any design or coding occurs. Put another way, do you think you could tell a team of developers everything that needed to be in a piece of software before it was up and running? Or would it be easier to describe your vision to the team if you could react to functional software? Many software developers have learned the answer to that question the hard way: At the end of a project, a team might have built the software it was asked to build, but, in the time it took to create, business realities have changed so dramatically that the product is irrelevant. In that scenario, a company has spent time and money to create software that no one wants. Couldn’t it have been possible to ensure the end product would still be relevant before it was actually finished?

Source: http://agilemethodology.org/