J and I and Me
  Common Misconceptions: The Waterfall Model
I think the Waterfall Model is the result of a big misunderstanding, probably one of the worst in out industry.
Look at Royce's original paper (PDF can be found here. You will notice that the paper starts with the separation of different activities such as analysis and coding. To me that sound like an attempt to actually define basic software engineering activities instead of just unstructured hacking. The paper goes on and discusses more different phases that a project might go through. It shows a figure pretty much like the Waterfall model we are used to. No surprises so far.
But then the fun starts: The third figure already shows that the steps are not necessarily performed in order. The text says:
... as each step progresses and the design is further detailed, there is an iteration with the preceding and succeeding steps but rarely with the more remote steps in the sequence.
Let me repeat: The original Waterfall paper says that you might need to go back to previous steps, even remote ones. It even uses the term "iteration".
It goes on and discusses that once you run in production you might learn that your system does not perform well enough. That leads to major problems - and you will probably go back to the analysis. You might call it an iterative approach - even though it is probably not voluntarily.
Even better: The paper suggests:
If the computer program in question is being developed for the first time, arrange matters so that the version finally delivered to the customer for operational deployment is actually the second version in so far as critical design / operations areas are concerned.
So essentially you should do at least two iterations - the first version will not get it right. Another hint at an iterative process.
And the paper even suggests to involve the customer - probably one of the most important points in Agile practices.
Of course the paper includes sections that are quite different from the Agile school - such as the focus on documentation. But it is from 1970 - and the author is specialized in systems for spacecrafts. Those still rely a lot on documentation even today because of the extreme risks those systems have.
However, the bottom line is that the original Waterfall paper does not advocate what is now considered the Waterfall Model. It does not require going through the steps in order and it even mentions that the first release will not be a good solutions. Quite contrarily: It talks about iterations - very limited of course but it hints the direction Agile and iterative processes took later on.
I am still confused how the industry was able to misunderstand this paper. I wonder how much damage it did. Even today people still talk about Waterfall. I think everyone working with software processes should read this paper. I also suggest to use the term "Misunderstood Waterfall Model" when discussing a model that suggest going through the steps in a strict order. Because that model is just a misunderstanding, it is not what Royce described.
Oh, and next time someone talks about the Waterfall Model - don't forget to ask him or her whether he has read the original paper about it...
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This misconception is now also dissected in a book (included in the downloadable sample chapter):

Like other visioneers Royce wrote timeless things.
The misunderstanding comes with the larger software development process, which whishes a specification contract, carved in stone and signed with blood, so no one will change anything. Thats the dream of controlling, and the nightmare of developers, the so called waterfall model.
These processes (either commercial ones or the public 'V-Modell') were designed by people who didn't want changes and used by owners who love clear numbers and costs. So they picked those parts of Rocye' waterfall they liked, and the processes are used even they don't work.

Well, I have not been in IT at this time but I guess some "bad guy" was needed for being able to show a clear delta regarding newer approaches. Or it could be that the way, this waterfall was actually lived throughout projects was criticised, and not really the paper itself.
@Michael https://leanpub.com/leprechauns tells a more complete story. Also http://bit.ly/WaterfallMystery might be worth a look - same author.
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