@Switch BlaydeSwitch's summary is good. In my own case, I've never used an outline, however, I generally have most of the plot laid out mentally before I ever start writing. What I use are 'way points', essentially the points the plot changes, and then I write towards those. I know I have to get to each one, but how I get there (and how many chapters it may take, is completely up in the air). Often, I won't have any clue what the next chapter will be (or even what it'll be called) until I get there.
That said, the essential point is to know the ending before you start writing. If you never know how the story will end, then how will you ever get there. Everything in your story should help propel the story to the end, either in developing the underlying conflict, introducing the players, defining everyone's motivations, escalating the conflict and eventually resolving. The ending of the story is your ultimate guide. If you aren't building towards it, you're wasting your time on piddly details.
However, even that isn't carved in stone. With my six book "Catalyst" series, I knew from the beginning the series would eventually end with the character's death, and rebirth on a new world, but I never knew precisely how he'd die until the I was finished off book five. I figured it would be some kind of car crash, but I didn't know the specifics. Essentially, the details aren't essential. They're importantβbut it's more important you have the context for themβwhich often develops over time. But knowing what I was writing to, and the development the characters needed to undergo to get there, guided me in getting there.
We've also discussed endlessly whether it's better to write 'free-form' or complete your entire first draft before posting. I've of the 'finish before posting school', as it allows you to refine and prune guided by where the story ends up.
However, not everyone writes that way, so I'll leave how you write up to you in that regard.