Coming from a Gamasutra interview with Nintendo's Risa Tabata and Kensuke Tanabe...
"First, the basic idea is to have the fun element of the game. As long as we can see that, we can move forward with that game. There are cases where we will start with using documents to lay out the plan, but this time we thought it would be nice to get the feeling of the game, so they (Skip) were able to come up with a prototype fairly quickly." - Tabata
'Nintendo, itself, I believe we create games in a very unique way. First, we don't create a lot of documents when we go through the development of a game. There are companies that I know that have a huge stack of documents listing up basically the things they want to incorporate in the game. Nintendo has its own way." - Tanabe
"We don't start a project until we know what's going to be the main core of that project. Once we know what's going to be the baseline, the core of that game, the fun element of it, then we start to create the prototypes and play around with it, and start adding elements to make it a fun game -- what we can do to make it a fun experience. In that process, obviously, we have a lot of ideas that will get passed through, and some of them will get dropped or moved forward." - Tabata
"Among all of these things that we do to come up with a game, by simply creating one game it will be extremely difficult for a development company to understand the importance of that. And that's mainly the reason we tend to work with [developers] for long periods of time. So we can get them to understand the philosophy and idea behind the process we go through at Nintendo. And for those companies that end up understanding our ideas, and agreeing to work that way, those are essentially the companies that will work with us for the years to follow." - Tanabe