For me, it is sort of a mix. There's three parts for me, characters, main outline, and story.
The characters always control themselves. They tell me when to write, what to write, and how to write it. I just follow their directions. I've often been amazed at how conversations turn out and how character's react, because I'd never have thought of that, but Lois did. (I'm only mildly schizophrenic
)
I always outline the entire story before I start writing, or very soon afterwards. It helps me when I have writers block and also helps me maintain the proper momentum of the story. If I didn't have an outline, you'd be stuck listening to me describe a cat for ten pages. I find my outline very helpful in keeping the story on track - especially when you have a "time/date sensitive" A-plot. Then an outline really helps.
At the same time, my outline never looks the same when I am finished with the story. The main points are generally the same, but everything else has been twisted every which way. My story or the characters always take over some section or sections and that changes the rest of the story.
Finally, I have the main story, or the main idea. Usually, I have this idea from the beginning and it stays with me till the end. I've only once ever radically changed the main idea in the story while writing.
Overall, the characters control the story, but they try to follow my outline
