The document describes the process of modular program design using three stages: top level design, data flow, and refinements. It provides an example of designing a program to find the leading Formula 1 driver by reading a file, determining the driver with the most points, and displaying the results. The top level design shows the main steps, data flow shows input/output between steps, and refinements provide more details of each step. A second example designs a program to get daily temperatures from a user, calculate highest and lowest, and display the results.