I don't develop characters in any one single way. I use a multitude of different techniques and it just depends on my mood and the project and how much I have to go on regarding plot and character.
Develop as I go- As I write they 'come alive' and I add things as they come up including background and family details. That way they can surprise me. I decide sentence by sentence need by need who they are, what relatives they have, their attitude, background, and issues. This does require a lot of record keeping. Details need to be written down as they develop and often I have to go back and look things up in the draft if I didn't write them down.
Spring forth fully formed- This happens sometimes. A character complete and total and fascinating bursts fully formed from the imagination. I know them inside and out. This isn't really a good way to do it. It is unreliable and sitting around waiting for characters to 'just come' is... not the kiss of death... but certainly a form of procrastination.
Idea of a character- I base them around a few personality traits or their function in the plot, or an idea I want to explore. This is an abstract way to begin. Without gender or appearance. In some ways it's working backwards. I have one character who is based on the idea of ambition- driving all consuming ambition and this defining trait informs her actions throughout the story and provides her drive forward.
Plan them- Once in a awhile I work them out on paper before hand making a character info/profile work up- I like the one from "You can Write A Mystery" by Gillian Roberts has a very good character profile to fill out for creating characters. It's very thorough and asks questions you may not normally consider like "Work Life" and "Private Life" so you can define who the character is in these different situations.
It honestly just depends. A lot of times I just start writing cold. Sometimes I want a plan. But I like to let them evolve and surprise me as I go.
Often I find giving them a goal, makes them interesting. Giving them something they want to achieve, whether saving up money to start their own B&B or a desire to become a fashion designer. I think this helps secondary characters a LOT because it gives them something they want that isn't related to the main character at all and gives them a life independent of the events of the novel which enlivens and informs their actions in the story.