PURPOSE: Needle guidance software using augmented reality image overlay was translated from the experimental phase to support preclinical and clinical studies. Major functional and structural changes were needed to meet clinical requirements. We present the process applied to fulfill these requirements, and selected features that may be applied in the translational phase of other image-guided surgical navigation systems. METHODS: We used an agile software development process for rapid adaptation to unforeseen clinical requests. The process is based on iterations of operating room test sessions, feedback discussions, and software development sprints. The open-source application framework of 3D Slicer and the NA-MIC kit provided sufficient flexibility and stable software foundations for this work. RESULTS: All requirements were addressed in a process with 19 operating room test iterations. Most features developed in this phase were related to workflow simplification and operator feedback. CONCLUSION: Efficient and affordable modifications were facilitated by an open source application framework and frequent clinical feedback sessions. Results of cadaver experiments show that software requirements were successfully solved after a limited number of operating room tests.