Need to blog this one so I don't lose the link. Some reading for a rainy day...
Saying "do iterative development" is one thing. Figuring out how to actually do it for a group in an organization that isn't accustomed to it is another thing entirely. So here is a list of resources on the subject of adopting, planning/managing, and doing iterative software development -- particularly for those coming from a background of phased-sequential (waterfall,V) model of planning.
Brad Appleton's Iterative Development Resources.