Traditional publishing, for those unaware, is when the author completes their novel and then submits it to a publishing house, with a covering letter telling them that this is the next big thing and that they would be stupid to reject it! An editor at the publisher will read the work, weigh up the plot theme and writing style against their 'brand' and current catalogue, and then decide whether to reject it or to publish it. If the publishing house decides to go ahead and publish the book, they will buys the rights from the writer and pay an advance on future royalties. The Publisher will pay for the front cover and branding of the book to be finalised, and stock pile as many hard copies as they feel confident of initially selling. Perhaps most importantly the Publisher will be responsible for marketing the book, making sure it gets to the target audience and general public quickly through already developed relationships and channels.
Self-publishing is a bit different, and far more reliant on the author, as they will be responsible for everything. Marketing and distributing can be difficult and tough going, requiring investment of time and resources without any guarantee of success (a often soul destroying task!). Thankfully with the advancement of ebook reader technology, today's Self Publishers do not require to pay for the hard copies to be printed and stock piled, reducing much of the costs associated with this route from even a few years ago.
Pro's & Con's
One of the main drawbacks with Traditional Publishing is time. As a writer, once you have completed your novel, you want everyone to read it as quickly as possible (partly so you get the feedback and satisfaction that the hard work you put in was enjoyed). Publishing houses however do not move quickly, with the larger ones often taking up to six months to work through the backlog of 'slush' before they even read your novel. And of course it is highly unlikely that the first Publisher you send your work to will go with it, so you will have to go through the process with several before gaining a glimmer of hope. Even when a Publisher gives your book the green light, the actual process of producing the book can take at least another year (though this relates more to fiction).
Self-publishing on the other hand can be concluded in a matter of days. The author will create their cover page, prepare their marketing spiel, get the formatting lined up to the requirements of Amazon, Smashwords or iBook Store and be published before they know it! Of course the Traditional Publishing will attract a higher instant return due to their brand, huge resources, experience and proven marketing methods, whilst Self Publishers will inevitably learn as they go.
Another important point to remember if going the Traditional Publishing route is that they will in all probability want to make changes to your work before they publish. These might be small changes, such as character names or locations, or they could be big changes and require some rewrites, potentially changing the direction of the story and your vision completely. Publishers will have their reasons of course for any changes; parts of your work might be to graphic, controversial or have swearing which doesn't fit their brand, or simply because they think in their experience parts of the plot are weak. With self-publishing the author retains control over the contents, ensuring it is their book and vision which hits the shelves (however good or bad that might be!).
So, what's best for you? In all honestly, I think it comes down to two points - how good you believe you are at sales and marketing, and how stubborn you are to see your work published verbatim how you wrote it. If you are not great at selling yourself and your work, then no matter how good your book is, it won't get the recognition it deserves. Likewise if you are happy to potentially change your plot to suit someone else's preference, then the benefits of Traditional Publishing should be seriously considered.