Along with adverbs and telling, I think backstory completes the unholy trinity of writing. So much so that agent and writing guru Donald Maass advises you cut any backstory in the first 50 pages. But backstory has its uses, and sometimes, it's critical to know that history.
Even if it's not critical for the reader to know it.
In some genres it's more of an issue. Fantasy, science fiction, historical--any genre where the past and the history of that past strongly affects the current plot and the motivations of the characters. Doubly so if the antagonist is the one with the past that's come back to haunt someone, since you don't always see the antagonist's POV.
My current WIP has a major event that happened decades ago, but this event is the trigger for all the present-day plot events in the story. I knew basically what had happened in the past, but I focused more on what my protagonists were doing/uncovering and chose what parts of the antagonist's plot to use based on them, not what had actually happened.
By the time I was done, I wasn't happy. The mystery part wasn't as strong as I knew it could be, because I hadn't spent enough time on the backstory. If you looked too closely at the plot, things didn't quite line up, and questions were left hanging. The more you thought about the story, the weaker the story got. Not a good thing.
So I went back and wrote the backstory.
I drafted a rough synopsis that described that past event and what happened. Why the characters did what they did and the ramifications of those actions. When I was done, I did the same thing with my antagonist. Then, I did it with all my major and supporting characters who were involved in it, no matter peripherally. (One character was nine years old when this happened, but after doing this, I realized the event had a profound affect on who he was that made his character much richer and more interesting)
That's a lot of summarizing and a lot of backstory, but afterward, I knew how all the pieces fit and those plot events that felt shaky could now be made solid. I knew why folks did what they did in the present day plot, even if they weren't the POV character. I had secrets non-POV characters wanted to avoid, which gave me all kinds of great fodder to use to up the mystery, the tension, and use for plot.
I made this event matter to the present day world and those who lived in it. It wasn't just "something that happened once" anymore.
If you're facing a story with lots of history, try writing out that history. Ask yourself:
What happened in the past and why?
It seems simple, but the act of writing it down forces you to make decisions about things you might not have realized weren't clear. It'll also help you spot any holes or weak logic. Try to go down three levels.
For example, Level 1: Why are they doing the obvious thing? (the plot reason most likely) Level 2: What made them do that thing? (probably the motivating factor from the backstory) Level 3: What made them do that thing? (a solid reason for this to happen at all. And the most likely culprit of plots that feel a little flimsy when thought about or questioned).
How does it affect the current plotline?
Knowing this can help you decide what aspects of your backstory to reveal to the readers. The bits that actually matter, not the full history that doesn't advance the story.
Were any of the current characters involved?
If so, what was their role? How do they feel about it now? How does it motivate their actions and choices now? This will help make them real people with real motives, even if they're not major players in the story. It'll also give the sense that things are going on in the world and it's not all about your main characters. Supporting players have lives, even when off screen.
How do the POV characters feel about it?
If your POV characters weren't involved (or don't know about it) odds are they're trying to figure it out in some way. That might even be the goal of the book or a subplot. What do they know? What do they think they know, but have wrong? What parts are they trying to solve, but uncover something totally unexpected? Knowing the backstory can help you plot twists and turns and surprise the reader in ways that make sense and feel grounded. It'll also make it easier for you to plot when, where, and how they discover information, especially if other characters hold the key to any of that information. You'll know exactly who knows what, why they may or may not talk about, and how badly they'd want to keep (or reveal) that knowledge.
Backstory gets a bad rap, but when you think about it, it's the motivating factor behind your characters, and characters are what drives your story. You need the backstory to create rich and proactive characters. So why not write it all on its own? It keeps it out of the story, allows you to explore the history that captured your interest, and helps you crafts a story and characters with depth.
How much does backstory affect your current WIP? How much have you put into the story? Do you feel it's too much? Too little? Have you tried writing it out separately?