In recent years the term agile has become overused. Many seem to think that if they have have unit tests, standup meetings and burn-down charts, they're agile. All these practices are good, but they don't necessarily make you agile. Even iterations or some kind of certified master don't necessarily make you agile.
So what is agile? If I were to sum it up with one word it would be communication. Communication is everywhere in the agile manifesto:
[We value] individuals and interactions over processes and tools.
I see this as a reaction against processes like RUP that felt like a software development factory where developers were replacable cog wheels. Agile recognizes that it's individuals with intelligence, creativity and drive that make a project succeed.
But individuals are not working in isolation, they need to interact with others. Interactions means communication. Not one-way communication but interactive dialogues. Misunderstandings are inevitable in communication. When you say or write something, it is almost certain that the receiver will misunderstand something. You can't just send someone a document and think they will understand what you mean. You need to verify what they understood, and the best way to do this is in a face to face conversation.
A key part of agile is to have close communication within the team and between the team and the customers.
[We value] working software over comprehensive documentation.
Documentation is a form of communication. Some teams stop writing documents "because that's not agile", but that's a huge misunderstanding. Agile does value documentation, but it values working software more. Working software demonstrates progress better than completing a number of documents, and it demonstrates the team's understanding of the requirements better than a requirements document. But documentation may be useful to explain what you were thinking when you developed the software.
I said that iterations don't necessarily make you agile, but iterations are definitely needed to be agile. Iterations is not a goal in itself, the purpose of iterations is to improve communication with the customers by getting feedback often. It is inevitable that we misunderstand what the customers need. Iterations help us to discover these misunderstandings early, before they get too expensive to fix.
[We value] customer collaboration over contract negotiation.
Collaboration certainly means communication. The development team needs a positive dialogue with the customers, and not just communicate with formal documents.
[We value] responding to change over following a plan.
This may not seem like to be about communication, but actually it is. Where do the changes come from? From the customers. The customers and the team should communicate often, not just up front.
These values are the basis for practices like on-site customer, iterative development and pair programming. It's the values that make you agile, not various practices. The practices vary depending on the size and complexity of the project.