Shared Worlds has a neat photo project on their website where authors write their best advice on their hand. This one, by Karen Lord, was the one I liked the best.
In case you can’t quite figure out what her drawing is, it’s an iceberg. Icebergs have a 1-to-3 ratio: for every foot that you can see, there are three feet you can’t see below the waterline.
What Karen is saying is that you need to write 3 times more stuff than will ever appear in your finished story. You need to know your characters like you know your best friend or spouse (or the palm of your hand). You need to write apocrypha (stories which happen outside the timeline of your book) so you can know what your characters are like before everything crazy starts happening to them. Where were they born? Under what circumstances? What’s their room look like? What was their best birthday?
Some of my backstory ends up in my stories, but most of it doesn’t. And that’s okay, because the point isn’t to give the reader all of that info in the main story; it’s to help me write a 3-dimensional character that I know inside and out. Yeah, I’m not the world’s greatest plot writer (no twists or surprises or red herrings), but I get consistently good reviews from everyone about my characters and the world I’ve created. Making a believable world is especially important when doing fantasy or sci-fi.
I think the iceberg theory is true for books with a large research component, too (e.g. historical fiction): you should learn at least 3 times more information than you put in your story. Even if a certain fact doesn’t fit in your book, just knowing it can help you create a more realistic world. For example, I know quite a bit about religion in the 14th century. I don’t put many facts about religion or the church in The Flames of Prague, but just knowing what I know about it colors what Jakub says and what he does. So it’s not wasted information.
I haven’t given out a writing exercise in a long time, so here goes: take a story that you’ve already written (preferably a long, novel-ish one) and write some apocrypha for it. Just take a character (or all of them) and write something that happens outside the main story. It can either have happened in the past or concurrently with the main story (but preferably in the past). It doesn’t have to have a plot. It doesn’t have to have a beginning and an end, like a proper short story. It can just be a moment in time–a day-in-the-life. (See my website for some of the stuff I’ve written. Two stories tell how Anselm and Micah met and how they became friends, but some of it is just random, like a Passover seder at Isaac’s house.)