This is why I agree with other commenters who say that there's no good way to do this: with pencil and paper, you can't make changes / expand / remove parts so easily, it's harder to make big documents, it doesn't look that good, and yet... it still is one of the best ways to do it.

P.S. I don't have anything against paper, and in fact I think it should be used more frequently while designing / prototyping / trying to understand or come up with algorithms, etc, it's a very useful tool.