There are 3 basic elements to good Karate; Kihon (basic techniques), Kata (training exercises with predetermined moves), and Kumite (sparring). These 3 key foundations are also referred to as 3 K's.
Many Karate specialists say that Kumite is the spirit of Karate and Kata is the soul, but without your Kihon neither can exist. Thus an equal amount of attention must be given to all 3 basic elements in your training.
When Shōtōkan was being developed, Master Funakoshi's key area of focus was Kata and character building. With the help of his son Gigō Funakoshi, Kihon was then created to better understand Kata fundamentals and to make it easier to teach the complexities of Katas. Although Master Gichin Funakoshi did not encourage Kumite, he later allowed his son to develop this last element.