It's a pretty tough subject to talk about really, but I believe it starts with a mood. When I feel creative I'll usually try and get started straight away and just see where it leads me, but before that there's something that triggers that creative feeling.
Sketch, watch, walk, talk, delay? Am I the only person who notices Jools missing something from this prompt? For me that's listen (to music). 99% of the time you'll find me with headphones in and for me that's essential to the flow of a project. Anything can trigger that creative mood and start an idea flowing but the best way for me is music (though video is cool too).
A while back I'd been hanging around with some friends and walking back from a really crummy skate park in the area, I don't skate but I love extreme sports and spent a bit of time dabbling with BMX's sometime ago. I put on some music, then a track I hadn't heard in a while came on. Few clicks later and I'm listening to a similar mix and an idea starts to form in my head. The idea was to do a pretty show-offish extreme sports magazine and I'll try and dig out some old pictures and post them with this. (don't mind me if I clean them a little, content was going to be danny north style dynamic pictures)
Development stages... Kind of like a virus when a good idea hits me it doesn't make much sense, I rethink it a few times in my head and then I'll start making it, sometimes that means I'll be drawing all over your napkin in the pub and sometimes that means I'll trail off talking while I mess with some Photoshop effects but in the end the original idea usually evolves in a reasonably smooth way for me instead of distinct development stages - don't worry, you can still see it, and when you look back the final design compared with the original, that's usually a shock to me.
P.S. I know this is more than 300 words!