Well okay let's say you've a thought...
Starting top-down to hybrid
I want to have a universe of STL moonships full of medieval troops led by high-tech religious fanatics going out to reclaim the galaxy and restore the old FTL empire even though the former method of FTL has been lost.
Now you've a universe. Now you want a story.
Okay, clearly there's going to be plenty of battles and unknown new cultures for these moonships to discover. So I think, the STL Moonship of Castille comes upon an old world of the Human Hegemony (I'm making this up as I go) from the old Imperial Starcharts (mind you star charts have to follow the stars as they move through a galaxy). But, the planet is filled to the brim with biotechnology and insectoid hordes. The human populace appears to be scattered through the planet living in small villages, clearly subjugated by the insectoids. The protagonist Aragorn and Castille will begin invading the planet!
Then you go down to a more micro level and start deciding how the war goes, what things they discover and so on. Then, now you've a setting. After you finish this novel you think, well i could do another moonship, I could do another a story from a reverse perspective, I could do prequels, I could do another story with Aragorn and Castille who after cryosleep journey eitehr something happens on the moonship or they arrive at another planet.
Micro to Hybrid Approach
I want a story of vengeance. Okay I need some characters. I'll have an emperor-cloak looking gal with a band of cybergoth warriors. She'll fight... demons. In hell. The vengeance is for her hometown being sacked by demons.
Alright I've got a sense of the setting already.
Okay there's Hell. So, let's say these are plane-shifter troops whose Empire is constantly besieged by demons that teleport into their realm. Thus, they must send forces to battle them every so often. I've built myself endless stories right there. There could be battles, political intrigue (like say demons and imperial official colluding for selfish gain on both sides), the demons could be a complex culture, the Empire might not be the only people, there could be a lot of magical powers possessed by the Imperial Planeshifters, cybergoth is cool by itself...