The system development is broken down into a series of smaller development goals. The system is released in a series of versions with each version potentially adding more functionality.
The project may go through several versions. Each version replays the methodology with the previous version used as a starting point for the next version. Some features may be deferred to a later version. Changes in the requirements that happen in the design or implementation phase, are usually deferred to a later version.
Many times one version release concentrates on quality improvements while the following release concentrates on added functionality. This alternating release schedule is common and reflects the difficulty in reaching a high quality product before the customer visibility. The environments that the customer uses the product may be so variable as to preclude exhaustive testing.