The absolute worst approach is to Think Small and Work Big. No coherent bigger picture strategy. Large development effort with no release in sight.
Think Big, Work Big is the classic “waterfall” approach. In the best version, there is a coherent, bigger picture strategy but there is no incremental delivery nor experimentation. This generally produces lower quality, costs more, is slower, and is not that fun of an environment to work in.
Think Small, Work Small is a typical mistake for Agile novices. Teams work in small batches but there is no coherent, bigger picture strategy. Jeff Patton used the metaphor of a “bag of leaves” versus a “tree”. This tends to lead to teams iterating in circles without leading to any significant larger outcome.
The most effective approach is to Think Big, Work Small. There is a coherent, bigger picture strategy. Work is done incrementally, and iteratively. NOTE: Thinking Big does not mean defining all the details up-front but rather just enough breadth and depth to convey the overall context to allow autonomous teams to operate effectively.