One of Stephen King’s ‘rules’ for writers is that ‘The situation comes first. The characters — always flat and unfeatured to begin with — come next.’
This is quite the opposite of the way I work. I try to create fairly fully realized characters first, then find situations in which to place them. How else will I know how they will act and react if I don’t know who they are?
Indeed, I sometimes write short stories featuring characters to better understand them before placing them in a novel. Those short stories are not really intended for publication (and are sometimes a bit erotic). They are back story, character study.
Of course they will grow once they appear in a novel. It is inevitable that I shall learn more about them as I write. But I know enough when I start that they will not do things ‘out of character.’ Or if they do, there will be a good reason. It will be the sort of growth that makes sense. Making up a person as one goes along is not a good way to create a cohesive character, someone who seems real.
Unless one goes back and rewrites extensively. And who wants to do that? Get it right from the start, I say; know your primary characters.