Keyword research

I was wondering how other people carry out keyword analysis. Do they just look for low competition highly searched, relevant words? Or is there more to it?

Personally I use http://inventory.uk.overture.com/d/searchinventory/suggestion/ to find out how many searches are done for the keyword. You need to bear in mind that Overture has less searches than Google, so a accurate figure for searches on Google can be found by multiplying this by 4. Obviously, checking the amount of competition is just a case of searching for the term on the relevant search engine (in this case Google) and noting the amount of other results there are.

Does anyone know of any better tools/techniques out there to do this?