If I'm starting from scratch I start off in my sketchbook. I swear by these A4 squared notebooks by Paperchase as you can easily rip stuff out and stick things in; they are spiral bound and pretty forgiving. I plot away designs in pencil, usually rubbing stuff out and sulking because something isn't quite right. Once I've got it down and I'm happy I then get my triplus/promarkers out and start thinking about colour. 7 times out of 10 the colour will change in production. I find if I'm copying the design from my sketchbook sometimes it being in colour is easier to read that it being entirely in pencil.
The best thing about working this way is that I use my sketchbooks as reference for other pieces. A lot of my work has repeated themes and motifs so it makes my life easier flicking through the pages and picking a few designs to make something new.
The KG Chart program. Basically a squared sketchbook on your computer but then tells you what DMC threads you should use. It has a fair few different functions and I'd definitely advise you to have a browse of the user manual to get the best out of it. It is easy and fun to use for a beginner (it took me the whole of 5 minutes to work my way around it) resulting in patterns you can print out and go crazy with. Did I mention it's free? There is a pro version that you have to pay for after a 30 free day trail (the pros of pro is that you can work on a much bigger chart size, no 'KG Chart' text printed on the bottom of your pages, future improvements will only be for the pro version and there will be different thread pallettes...for all you anchor lovers out there) but the standard free version would suffice for anyone just starting out. The best bit is? If you have an Iphone or Ipad you can download it from the app store for a very reasonable $4.99 and create patterns on the move. My public transport woes are over!
Screen shots of the Iphone version from the App Store page.
If I'm not starting from scratch and I've been given an image to use then I have a couple of tricks which are as follows:
1.Tracing paper, downloadable graph paper, an inkjet printer and a pencil. I use this free site to create the graph paper, opting for the 1/10" engineering graph as it's a bit easier to digest. I then print that out onto tracing paper (again, Paperchase sell packs of A4 tracing paper that are inkjet friendly. It's from the Paperworks range and is number 21) which I then overlay onto the image I'm working with. I trace out necessary outlines and shade in squares that need to be stitched on the graph paper. I'm better at working things out through trial and error so this method works best for me. It will need a bit of tweaking here and there to work but usually stays quite true to the original image you are working from. That is how I produced the defend pop punk design you can see here which was from this logo. Doing it this way may take longer but sometimes is less fuss than letting a computer program do it for you because you can decide exactly what you want and where.
2. However, if you want to utilize the computer for faster results then the KG Chart program can be used (starting to sound like an advertising campaign). Once you've mastered the program you can start dabbling in imported images. You may have to tinker with the size and threads used to produce a stitchable design that won't take 4000 years to complete. This program generally turns out good results which can be saved or printed.
Some of this will come as no surprise but I hope this helps some of the novice stitchers out there.