If a friend rings you up asking for directions to a destination, what is the first question you ask them?
You ask them, where are you now? In order to go from A to B you need to know where both point A and B are.
How does this affect your golf? If you are looking to improve, you need to know where you are now and where you would like to go to. This can be tricky just from looking at your play on the golf course.
Skills testing is a good way to find out your strengths and weaknesses independent of other shots.
Simple examples of skills tests include: hitting 10 putts from 3 feet, count how many go in, hit 10 shots from 150 yards, count how many hit the green, hit 10 tee shots and count how many hit the fairway. Now you can start to see your strengths and weaknesses a bit easier and where to focus your valuable practice time.
There are many more elaborate skills test and are great when looking for more detail. The book 'Golf's Red Zone Challenge' by Charlie King and Rob Akins has some great tests.
Don't forget, when looking to improve, knowing where you are now is a great help when deciding where you want to go.