The first book I read by Barbara Hambly was Those Who Hunt the Night. She immediately became an author I looked for in bookstores. Irony: this book was different than many of her other books. Go figure.
What I loved about it was the solidity of the characters. These people had lives pre-story and a sense of lives post-story, yet it is a stand-alone book. That sense of reality was created for this book and this book alone. I'm pretty sure this is the first book where I felt that to be true.
Apparently, some authors have difficulty making people. I don't have this problem (or I don't think I do) so I don't know what that would be like. I can say, even I have used some tools in the past to help flesh out characters.
I've mentioned I used to role play. I was blessed with a group who loved character-driven campaigns as much as I did (as opposed to action-driven where you spend 2 minutes rolling stats, play until you die and roll another character before the next encounter. A lot like a video game, and not my cup of mead).
My group would spend an entire evening creating characters, equipping them, and coming up with backstories so our actions during play would be realistic. That's the kind of nerds we were. One of our members had a background creation book that was dog-eared with use. Galena was one of the characters I created this way. It's how she ended up with four children, a short, orange-haired husband (who later became a character of his own) and a proficiency for wrestling learned during a two year stint as a slave gladiator. That's background.
I think it's important to a story. You don't have to put all this info into your book. It might be better if you don't. But knowing someone's past can help determine future actions. Galena's wrestling background means she's not afraid to drop her morningstar and grapple with a bad guy if that's how it has to be. Having four children may affect how she treats other children in the story (it doesn't, by the way. Her non-barbarian husband is the mother in that family). Being a slave means she might have met another character in the slave pits (that would be Tusk, Star of Justice fans) who shows up to say howdy and becomes a part of the action for a while. Noodles, if you're out there, I kept my promise!
This doesn't mean a story without all this can't be great. Sure it can. Some tales don't require knowing the third-removed cousin of the protagonist's chiropractor. And sometimes creating that kind of detail can be an excuse to avoid writing the actual story. I'm just saying I prefer people who seem real, and those kinds of people have backgrounds.
The background bonus? You might get a prequel, sequel and side-quel out of it. I have.