1. Why would I go to the trouble of writing yet more content for my already populated website?
2. Why should I create a website and then still have the hassle of finding new and interesting things to publish to it?
3. Why, after I've invested time and money in building my website, am I advised to keep tweaking and changing it- wasn't it good enough in the first place?

To answer these questions it is helpful to take a step back, and remind ourselves of the fundamental aspects of website visibility and popularity. No matter how "perfect" a website may seem, its visibility to the search engines is temporal- over time an unmanaged site will drop off the engines radar.

One way of contributing to your websites visibility is to regularly provide fresh content. Once your site is indexed the engines will discover that it is a site which constantly changes- with additional content. The engines will crawl it more frequently and thus index it more frequently- this will improve its visibility. A great way to add fresh content without tinkering with the information architecture is to create an on-site blog.

Every time you post a blog you create a Uniform Resource Identifier (URI)- a resource residing in your site. By writing a blog you create a permalink- a permanent link to a particular posting in a blog. A permalink is a URI that signposts the blog entry. It is not dependent on the URL (or page) and so doesn't rely on the page in which the original posting occurred to be found. This means that whatever changes you make to the site your blog entry will never vanish completely.

Aside from the SEO benefits there are a multitude of other reasons to blog. Back in September 2007 Pete discussed these benefits, but here is probably the best non-SEO reason:
It allows you to share ideas and concepts that may not "fit" anywhere else on your site.