This is a very enlightening thread, one from which I am learning a lot.
Concerning my own experiences, early on I used a relatively complicated process to develop characters and plots.
Then one night I heard Dustin Hoffman tell a story about the time he worked on a film with perhaps the greatest actor of all time, Lawrence Olivier. Before shooting each scene, Hoffman (as I recall the story) would walk to a corner of the set and go through an extensive routine of "exercises" involving heavy breathing, chanting, shaking his head and other such distracting (and sometimes loud) actions. Eventually, Olivier approached him and asked him what the heck he was doing. Hoffman explained, "I'm a method actor, and these things help me get into the character." To which Olivier famously replied, "Why don't you just act?"
When I heard Hoffman tell that story, something inside me said, "Why don't you just write?"
From that point, I greatly reduced my own ritual of heavy character development, extensive note-keeping and detailed plot outlines. Granted, I still keep a character sheet, but it's mostly to remind me of the characters' names, as I am constantly changing them.
I also maintain a simplified plot outline because I'm one of those weird authors who tend to write backwards. A pivital or climatic scene will come to mind, so I write backwards from that point so that the flow of the story will aim toward that moment, all the while also moving forward from that point so that the resolution will match the build-up. Then, I start the actual writing, all the time making changes, often so that the action of the characters will be true to their personalities.
However, the more experience I gain, the more I tend to keep most of these things in my head and less on a piece of paper.
I'm weird in a lot of other ways, but they have little to do with my writing (ha, ha!).