It might be useful to emphasize that the "testing" during the iterations could have two parts. One is the testing against functional (or technical) spec, as mentioned. Another against user req, which involves account manager, client, point of contact or whomever.
It would be good to know that while you're hacking the code, your marketing folks have changed the "name" of the product from Performance Appraisal to Goal Management... so that you won't be surprised two months later, the marketing material given to clients doesn't sound quite the same as the spec you've built your app on.
In other words, a challenge of planning and its implementation is that your target is moving.
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