From: http://en.wikipedia.org/wiki/Agile_software_development
Gerald M. Weinberg: We were doing incremental development as early as 1957, in Los Angeles, under the direction of Bernie Dimsdale [at IBM’s ServiceBureau Corporation]. He was a colleague of John von Neumann, so perhaps he learned it there, or assumed it as totally natural. I do remember Herb Jacobs (primarily, though we all participated) developing a large simulation for Motorola, where the technique used was, as far as I can tell, ... All of us, as far as I can remember, thought waterfalling of a huge project was rather stupid, or at least ignorant of the realities. I think what the waterfall description did for us was make us realize that we were doing something else, something unnamed except for “software development. quoted in Larman, Craig; Victor R. Basili (June 2003). "Iterative and Incremental Development: A Brief History" (pdf). Computer 36 (6): pp 47–56. doi:. http://www2.umassd.edu/SWPI/xp/articles/r6047.pdf.