Reports Wired Magazine:
While other companies often start by creating massive design documents that detail minute aspects of a videogame’s characters and levels, Nintendo produces rapid prototypes. The company creates, tweaks and refines a gameplay mechanic until it is fun and appealing, often spending many months in these very early phases.
“We prototype intensely in the beginning, until we find that core mechanic that really seals the deal,” says Tanabe, a producer at Nintendo’s home office in Kyoto, Japan. Even after that, Nintendo will change and refine games very late in the production process.
Although I’ve developed software from both a waterfall and agile standpoint, both have their pros and cons. But my gut tells me agile might be slightly better, especially as it pertains to games.