This paper focuses on the current state of knowledge in the field of software development methodologies. It aims to set the stage for the formalization of a software development methodology dedicated to innovation orientated IT projects. The paper starts by depicting specific characteristics in software development project management. Managing software development projects involves techniques and skills that are proprietary to the IT industry. Also the software development project manager handles challenges and risks that are predominantly encountered in business and research areas that involve state of the art technology. Conventional software development stages are defined and briefly described. Development stages are the building blocks of any software development methodology so it is important to properly research this aspect. Current software development methodologies are presented. Development stages are defined for every showcased methodology. For each methodology a graphic representation is illustrated in order to better individualize its structure. Software development methodologies are compared by highlighting strengths and weaknesses from the stakeholder’s point of view. Conclusions are formulated and a research direction aimed at formalizing a software development methodology dedicated to innovation orientated IT projects is enunciated.