Waterfall vs Agile: Key Differences and Usability of Each

What is the Waterfall Model?

It was the first formal software development method, introduced in 1970. The idea of predictable, sequential development originated in the engineering and construction industries. The Waterfall model became especially popular in military and aerospace projects because it was considered predictable, controllable, and well-documented. However, its greatest limitation is its rigidity.

According to Sommerville (2015), it is a sequential process in which a project progresses through distinct phases—requirements analysis, design, implementation, testing, and maintenance. Each phase must be completed before the next one begins. This structure allows for detailed planning and control but limits flexibility when requirements change.. The model is therefore considered as a foundational framework for later software development methodologies.

Our experiences with the waterfall

At Moravio, we used to apply the Waterfall methodology to manage our projects. This approach felt natural because it is easy to understand and widely used across various industries. Our process involved gathering all inputs from the client at the beginning of the project, which served as the foundation for the entire development. Any changes or discrepancies were first addressed from a contractual perspective before being implemented in the code. Based on the agreed-upon requirements, we provided a fixed price for the project. To ensure effective project management, we divided the work into phases, with the client making payments after the completion of each phase.

1. Phase Requirements gathering & analysis

In this phase, we conduct a thorough analysis of the customer's inputs, business goals, processes, and marketing strategies. We also determine functional and non-functional requirements, as well as the supported devices. This analysis helps us create detailed project documentation outlining the proposed solution, sometimes including wireframes. Additionally, we perform a technical analysis to describe the planned architecture, technologies, and database structure. Once the requirements are approved, we plan the technical tasks, prepare the budget, and provide the expected implementation costs.

2. Design phase

This phase involves creating the graphic design of the solution. We provide the customer with two to three rounds of feedback and revisions before agreeing on the final version.

3. Implementation

Once the design is approved, the implementation of the planned tasks begins. Throughout this phase, the customer receives regular updates on the project’s progress, with the final product delivered at the end. Any new requirements introduced during this phase are treated as additional work and must be estimated and approved by the customer.

4. Testing

The final working product is deployed to the testing environment and provided to the customer for thorough testing. The customer is usually given an agreed-upon period for this process. After testing, they are expected to provide feedback and sign the handover document.

5. Deployment

Once the product is approved, it's “launched” into production in accordance with the agreement made with the customer.

6. Maintenance

After delivering the finished product to the customer, we typically establish an SLA contract and provide ongoing support for the solution over a defined period. If the customer wishes to terminate the collaboration at any stage of the project, the terms and conditions for cancellation of orders and the contract must be mutually agreed upon

What do we think about waterfall?

I wouldn’t say this approach is completely wrong - it can be suitable for smaller projects or for building the same software solution for multiple customers. However, this is not the type of work we usually do. We develop custom software for our clients. While we can provide rough estimates based on previous experience, the more complex or larger a project becomes, the harder it is to specify every detail at the beginning - both for us and for the customer.

There have been cases during development when the responsible person on the client’s side changed, or their internal processes evolved. Sometimes, when customers finally saw the developed feature or design, they realized it needed to work differently or be adjusted due to shifts in user behavior or market conditions.

All these factors led to changes in the requirements for an already developed product. In the end, the customer was often dissatisfied because the original requirements no longer reflected their real needs — and we were dissatisfied as well, due to the rising project costs and the challenging negotiations about additional resources required.

Limitations of Waterfall we see:

• Problems with requirements often appear in later stages - during design, implementation, or testing.
• New information frequently emerges during development and must be reflected in both the documentation and implementation.
• The next phase cannot begin until the previous one is completed, causing delays between phases and prolonging the project timeline.
• Every change has to be approved by both parties and added to the contract before it can be reflected in the documentation and implementation.
• User testing takes place only after the entire system has been implemented, which often reveals errors or issues in the original requirements — making them costly to fix.
• New feature ideas may arise after user testing, requiring additional development.
• Higher risk of failure for more complex or dynamic projects. 
• Customer involvement during the project is typically low.
• Project changes can occur due to shifts in end-user behavior or market conditions.
• The original requirements may not accurately reflect real needs.
• Increasing project costs can create challenges for both the client and the software company.

Advantages of the Waterfall Model we see:

• Costs, time and resources are clearly defined. 
• Each phase has specific goals, outcomes, and approval criteria.
• All requirements are documented and approved by both parties.
• Easier tracking of progress, budget fulfillment, and timeline adherence.
• Clear distribution of responsibilities.

Where is a waterfall useful? 

• Systems with clear requirements that are unlikely to change over time (e.g., ERP modules, accounting systems, banking software).
• Systems constrained by legal or regulatory standards (e.g., pharmaceutical tracking systems or accounting software compliant with legislation).
• Projects with strict constraints on time, scope, and cost — often government contracts.
• Projects that require detailed documentation and formal approval processes (e.g., aerospace, pharmaceutical, or military industries).
• Systems based on well-known technologies (e.g., database migrations or rewriting legacy applications on a new platform without changing functionality).
• When stakeholders require a clear plan, detailed reporting, and strict control.

What is Agile Software development?

is an iterative and incremental approach to software development that emphasizes flexibility, collaboration, and customer feedback. It was developed in the early 1990s.

The most used framework that implements the principles of the Agile Manifesto is Scrum. 

Instead of completing a project through a single, sequential process, Agile divides the work into small, manageable iterations called sprints. Each sprint delivers a functional portion of the product, allowing teams to adapt to changing requirements and continuously improve through regular review and feedback. 

Agile values individuals and interactions, working software, customer collaboration, and responding to change over rigid processes and documentation.

(Beck et al., 2001; Sommerville, 2015)

Other used known frameworks

• Kanban 
• Lean Development
• Extreme programing
• Dynamic Systems Development Method
• Feature Driven Development
• Crystal

How did we start with agile development?

Hybrid between waterfall and agile

In the beginning, we used a mix of Agile and Waterfall - more of a hybrid approach.

Customers were not yet familiar with Agile and often did not fully trust it, so we decided to compromise. We agreed on a fixed timeline and an approximate budget based on the specified requirements. The main difference from our previous Waterfall methodology was the inclusion of close collaboration with clients, a key principle of Agile.

We divided the delivery into sprints, held demos with the customer every two weeks, and worked on specifying the requirements at least one sprint ahead. The cooperation and customer satisfaction with the final product improved significantly; however, the product backlog continued to grow during the project, which also extended the timeline. The downside of this model was the large amount of time spent on reporting and justifying every additional hour of work. It still wasn’t the win-win partnership we aimed to achieve.

We realized that our next projects needed to be fully Agile. We reworked our contracts, and over time, the Agile methodology and its benefits became much more widely understood and appreciated by our customers.

Why agile?

We prioritize honesty and transparency when starting a project with our clients. Rather than promising fixed dates and prices, we provide rough estimates based on initial ideas or specifications.

However, we work closely with each client to refine the end-user needs and requirements and to adjust the scope of the project to fit within the available budget.

• We believe that clear communication and close collaboration with our clients are essential to delivering successful projects. 
• Our goal is always to achieve the best possible outcome for our clients, which is why we work closely with them to refine the project requirements and adjust the scope as needed. This ensures that we are able to deliver a high-quality product that meets their needs while also staying within their budget.
• We recognize that project requirements can evolve over time, and we remain committed to adapting to these changes through continuous collaboration. By refining requirements and adjusting scope as needed, we consistently deliver high-quality solutions that meet our clients’ needs and expectations while maintaining budget efficiency.

Our primary objective is to

Provide exceptional quality work to our clients, relying on our extensive experience, expertise, and unwavering commitment to every sprint. We believe that by closely collaborating with our clients and continuously refining end-user needs and requirements, we can deliver high-quality solutions that are aligned with their expectations. 

Furthermore, we are committed to ensuring that our clients maintain full control over their projects and are free to choose another software provider if they are ever dissatisfied with our services (based on the agreed notice period, of course). 

Our success as a software development company ultimately depends on the satisfaction of our clients, and we work to ensure that every project we undertake results in a positive outcome for both parties.

How do we work

Among Agile methodology frameworks, we primarily use Scrum, although for some projects we also apply Kanban. We typically work in short, two-week iterations, during which we present, discuss, and refine the results with the customer at the end of each sprint. We gather feedback, convert it into actionable tasks, and prioritize them in agreement with the customer.

If a customer needs to change direction suddenly, it’s not a problem — in Agile, we are not bound by fixed contracts or rigid processes. We simply clarify the new requirements with the customer and plan the changes for the next sprint if necessary.

Advantages of agile development

• Flexibility and quick adaptability to changing requirements.
• Fast stakeholder feedback loop after each sprint.
• Clear visibility of progress for the team members and stakeholders.
• Higher team involvement.
• High product quality through frequent testing of implemented features.

Bottlenecks of agile development

• Risk of scope creep — priorities may change every sprint. 
• Requires experienced, self-organized, and cross-functional teams.
• Can be less effective in fixed-scope projects or when coordinating multiple teams. 
• Less predictable timelines and costs - the flexible nature can make it dificult to estimate the final cost and delivery date at the outset.

Summary of differences between Waterfall vs Agile methodology

So why do we at Moravio prefer Agile over Waterfall project management?

• Because we care deeply about what we develop, we care about the final product. 
• We prefer close cooperation with customers to create functional and meaningful solutions rather than engaging in endless negotiations over every minute spent on a project.
• We value agility and flexibility over blindly following the original plan.

Tools we use for Agile & Waterfall:

• Jira - an easy-to-use tool with boards suitable for all types of projects. 
• Product discovery from Atlasian - intuitive and easily integrated with development boards.
• For smaller projects we used to use Trello.
• Gitlab - occasionally used as a customer-provided tool for managing specific projects.

In general, we prefer to use the tools we know best but are always ready to adapt to our customers’ preferred solutions when necessary.

Other software development methodologies 

Based on the 17th State of Agile Report from 2023 71% of responding companies use Agile in their software development lifecycle.  However. Several others methodologies are used, including:

• V-Model
• Rapid application Development
• Spiral
• Incremental

How is AI changing management of Software development?

Beyond traditional methodologies, AI is reshaping how both Waterfall and Agile operate today. It is transforming the way people gather and manage project requirements. It enables easier data summarization and analysis, as well as automatic documentation generation (spec driven development).

AI also plays a growing role in application design - for example, by automatically generating wireframes from text prompts, making design accessible to anyone. It can even create simple working applications directly from documentation.

Across different roles, AI helps teams stay more consistent, efficient, and productive. It can generate development tasks from documentation, suggest specific code implementations, and assist with automated testing and validation of real applications.

From a methodological perspective, when comparing Agile vs. Waterfall, AI helps eliminate some of the traditional limitations of the Waterfall model — particularly around requirements gathering and documentation. These processes become faster and more flexible. While contractual and change-management constraints still exist, their impact depends largely on effective communication and collaboration with clients.

However, like any tool, AI can also be misused. There’s a growing risk that people might rely too heavily on technology and stop critically thinking about what they are doing. For example, teams might automatically generate large amounts of requirements or code that are unnecessary, unclear, or disconnected from real project needs — simply to produce something that appears polished on the surface.

Similarly, if AI-generated designs aren’t properly reviewed, they can lead to misunderstandings between designers, developers, and clients. This can create communication gaps, inconsistencies, and additional rework later in the process.

The same applies to automatically generated code — if it’s unnecessary or overly complex, it can create serious bottlenecks and issues in the development process. Just because something can be easily and automatically created doesn’t mean it should be.

AI should support creativity, efficiency, and understanding — not replace them. It’s essential to maintain human oversight, critical thinking, and collaboration to ensure that AI remains a powerful assistant, not an unmonitored decision-maker.

How do we see the future in Moravio?

At Moravio, we don’t strictly follow either Agile or Waterfall methodology. The choice always depends on the project type, client’s needs, and overall expectations. Both approaches can lead to excellent results or challenges — depending on the circumstances.

What truly matters is collaboration and clarity. When a client has a clear vision of what they want to create, or is open to refining that vision together with us, the process flows smoothly regardless of the chosen methodology.

In the end, like most things in life, success depends on people - on open communication, mutual trust, and the quality of the partnership.

Sources: 

Somerville (2015), Software Engineering, 10th GLO https://dn790001.ca.archive.org/0/items/bme-vik-konyvek/Software%20Engineering%20-%20Ian%20Sommerville.pdf 

Agile frameworks: https://www.wrike.com/agile-guide/faq/what-is-fdd-in-agile/

Software development methodologies: https://www.itransition.com/software-development/methodologies