I've been reading about collision detection and I saw that the first part was a coarse detection which generates possible contacts using bounding box hierarchies.

I understand the concept of splitting up your objects in groups, to speed up the detection phase, but I'm a little confused on how do you actually build the hierachy, more so on what criteria is used to group them together.

Do I iterate through all the objects in the scene, and check the distance between them to see where they should be inserted in the tree?

Do you know some resources that may shed some light on this topic for me?