Basically a Problem with something you have created. in the example of a story it can be anything from forgetting to add a comma to the lack of a plot.
Author: dude i just finished my story! i spent like 3 months hammering all the Fail Nails out of it though! >_< but now im sure its ready for the public!
Friend: Sic! *reads it...1 week later* dude....this book sucks! you forgot the biggest Fail nail of all! THERES NO PLOT!
Author: NOOOOOOOOOOOO! Its just like Twilight! D: