Top-down

A top-down process (often called the waterfall model) usually imposes a linear hierarchy of decisions from the goals to the sub goals and components.  It tends to work best for programs in a well understood domain, where the goals are clear and when you have a clear idea of how you want the piece to look like in the end. In those cases It can be very efficient, but in areas where you rely on chance or experimentation ( for creative or novel designs), it doesn't work very well. 

For example if you were to try and write a play using a top down method, you may decide how you want someone to feel when they leave the play, plot out the action of the story and how it's supposed to work. Then you get to the point where you're writing the dialog only to find that "ok now here's where this character is supposed to say something really funny, but with a sarcastic connotation in order to provoke this other person to react in disgust. OK .... uhhhh.... uhhhh". It doesn't work very well.

In comparison, with an inside-out method, you would start with an interesting conversation and then build on it, into a play, later. With a bottom-up process you might focus on a set of phrases or thoughts for your characters, relying on a collage later on to give it meaning.