To examine the question of what it means to say that the Iliad is an 'oral' poem, it is first necessary to overview the history of how the Iliad has been viewed by scholars, and to see how the opinion of the Iliad as an 'oral' poem arose. We must then ask what the implications are of this view as regards the reading of the Iliad.
Prior to the 20th century, the consensus was that the Iliad was the product of an author who could write, and opinion was divided between the 'Unitarians' who believed the work was written by one person and the 'Analysts' who regarded the Iliad as the redaction of several shorter poems over a long period of time. However, the general view drastically shifted from the late 1920s onwards owing to the work of an American classical scholar Milman Parry (1902-1935), who demonstrated that the Iliad was at least derived from centuries of oral tradition. Instead of having a literate reader in mind, the Iliad was primarily intended as a work to be performed orally for an audience, and was the product of improvisation during performance, which normally involved a poet chanting words with the rhythmic accompaniment of what would now be known as a lyre, but without reference to a fixed text.  The improvisation itself was rather like jazz music: namely, integrating pre-existing material into the composition and modifying it in various, unique ways. 
The most striking feature of the Iliad that Parry observed to be evidence of at least strong traces of oral composition was the repeated use of nouns with the same epithets, often in contexts where the epithet had little or no relevance. A clear example of this is the repetition of the phrase 'ποδας ὠκυς ᾿Αχιλλευς ' ('swift-footed Achilles'), which occurs five times in the first book in situations where being 'swift-footed' has no apparent relevance to the context. First, in answering Calchas the soothsayer, who asks Achilles: 'συ δε φρασαι εἰ με σαωσεις ' ('so consider if you will keep me safe')  if he explains why Apollo has sent a plague on the Greek camp. Second, in response to Agamemnon, who declares that he must take someone else's prize in exchange for having to return Chryseis to her father.  Third, as he answers Athene, who urges him to 'ἰσχεο' ('restrain') himself from attacking Agamemnon.  Fourth, in response to his mother Thetis who asks him to 'ἐξαυδα' ('speak out') about his troubles to her ; and finally in mentioning his being in rage because Agamemnon has taken his girl Briseis as a prize for himself. 
The common element in all these instances is not only the use of the words 'podas okus Acilleus', but also the fact that the phrase occurs in the same position of the line each time (i.e. the end). This, as Parry explained, is because it fits the rhythm of the lines, which in the Iliad are entirely in dactylic hexameter. Unlike English verse, Homeric epic is not based on the stress on certain words but on the quantity of the vowel sounds, being either short or long. The stock-phrase concerned, consisting of the latter half of a dactyl, a dactyl and a spondee as outlined, can be used to fill the end of a line during improvisation, particularly when introducing speech by Achilles. Parry called this sort of combination of nouns with certain epithets in specific metrical positions 'formulae', which he himself defined as follows: 'an expression regularly used, under the same metrical conditions, to express an essential idea'.  Another example is the epithet 'διος ' ('godlike'), which is applied to a whole range of warriors, including Paris, who does not exactly reveal himself to be a good fighter in his duel with Menelaus in the third book. 
To a first-time reader of Homeric epic, the Iliad may strike him or her as overly repetitive. Indeed, the scholar Peter Jones estimates that around a fifth of Homer is repeated.  Nonetheless, once Parry's basic point is taken into account, then the context of these repetitions can be appreciated: it would be wrong to criticise the work as consisting of tedious repetition when it is the product of oral improvisation, with certain stock phrases or 'formulae' inherited from prior generations of oral poets. In addition, apparent slips in the consistency of the plot can be easily explained. One example of such an inconsistency is the fact that Menelaus and Antilochus slay Pylaemenes in the fifth book , yet in the thirteenth book he is mentioned as 'δακρυα λειβων' ('shedding tears') as he takes his slain son Harpalion with the Paphlagonians back to Ilios. As Silk explained, in an improvised oral performance a composer may develop a new idea, but may prepare for it 'too late', and neither the poet nor audience can 'go back' on what has been said. 
Furthermore, accepting Parry's theory, it is likely impossible, as F.M. Combellack elaborated, to determine whether the use of any particular epithet with a noun has an artistic purpose at all, but it could be plausible that certain repeated phrases have a deliberate meaning.  For example, the phrase 'πυκινον ἐπος' is used four times in the Iliad and occurs in the same metrical position (in this case, in the middle of the line), but is traditionally said to imply a dramatic turning point of events in that it is 'dense with meaning and filled with urgency'.  An instance of this is in the seventh book, when Priam proposes that Idaeus make the 'πυκινον ἐπος' (here, 'reasonable suggestion') that a truce be drawn up with the Greeks to allow for burial of the dead.  When this is refused, the tide of battle begins to turn in Hector's favour. Similarly, when Zeus requests to have a 'πυκινον ἐπος ' (here, 'wise' or 'intimate' word) with Thetis, it eventually leads to the burial rites for Hector at the end of the last book.  In Parry's view, though, we should alter our reading of the text in that we should see the use of the phrase as no more than a coincidental, formulaic phrase.
Parry and his followers also went on to argue that most, if not all, of the Iliad was the product of formulae, and imbued a solely utilitarian, rather than artistic, purpose to these phrases. Such claims were drawn from research carried out by Parry and his chief disciple Lord on South Slavic epic poetry. Using the first fifteen lines of the Iliad as an example, Lord estimated that some 90 per cent of the Iliad was derived from formulaic phrases, a similar proportion (he claimed) to that found in oral epics from the former Yugoslavia.  If this were true, then it would follow that there could be no real literary criticism similar to that which can be found for the works of Shakespeare. Identifying apparent rhetorical devices such as hyperbaton (employing a certain word order for emphasis) and choice of words would be meaningless since the content and order are merely chosen for convenience in improvisation, and not for any real dramatic effect.
Hence, it is not surprising that the notion of an Iliad composed largely of formulaic phrases has been challenged. In an opposing view, 'formulae' do not pervade the entire work, but instead have restricted contexts. Most notably, Griffin pointed out that the speeches in the Iliad are generally free from formulaic phrases, and are strikingly different in terms of structure and vocabulary from the narrative.  In fact, after the Iliad and Odyssey were introduced in written form, smaller epic works appeared, attempting to imitate the style of Homer, and explaining the events that preceded and followed the Trojan War, thereby forming an 'Epic Cycle'. These poems are said to have employed much more repetition, and Richard Janko notes that Aristotle observed that speeches are much more prominent in Homer's epics than in the 'Epic Cycle'.  Moreover, as Silk pointed out, Parry often ascribed totally unrelated phrases to what he called 'families' of formulae (or 'formulae by analogy') merely by virtue of exhibiting the same grammar and metrical rhythm. For instance, 'τευχη κυνεσσιν' ('he made as spoil for the dogs)  and 'δωκεν ἑταιρῳ' ('he gave to his companion')  were reckoned to be part of the same formulaic family by analogy, owing to the same rhythmic and grammatical structure (i.e. phrases to end an line and containing both an aorist third person singular and a dative). However, Silk argued that an analysis of a sample of lines from, say, Shakespeare's play Antony and Cleopatra would reveal the same sort of 'formulae by analogy' in terms of identical grammar and meter, something that is due to coincidence, not any formulaic families. 
At this point, it is important to note that debate has also focused on what are said to be 'typical scenes' in that certain types of events tend to follow a regular pattern. For instance, Peter Jones describes the sequences of happenings for battle-scenes as follows: '(i) A does not kill B, B kills A (B here is always a Greek), (ii) A misses B, B hits but does not penetrate, A kills B (A here is always a Greek), (iii) A misses B but kills C'.  These conventions might be described by followers of Parry as 'formulae' deriving from oral tradition, making them impervious from real literary criticism. Nevertheless, Mueller uses an example of a battle scene from the fourteenth book of the Iliad to show how he thinks Homer skillfully employs variation to avoid what he terms 'rigid symmetry'. This includes altering the word order in each instance of a casualty or set of casualties, as well as additional description of who the people are in some cases.  Conventions do exist, but they can be changed over time and given a unique colour, and they exist equally in oral and written literature. As Mueller summarises, 'there is no sharp distinction between "oral" and "literate"' as Parry and his disciples seem to have thought. 
In conclusion, the Iliad is an 'oral' poem in that it is ultimately rooted in improvised oral performance as explained above. This is why, for example, there are many repetitions in the work, particularly with respect to epithet-and-noun phrases like 'swift-footed Achilles', which can be called 'formulae'. However, I think understanding that the Iliad is an oral poem should not drastically alter our reading of the text. The repetitions and inconsistencies, in light of viewing the Iliad as an oral poem, should not be grounds on which to fault the epic as a written text. In addition, it should be appreciated that whilst certain repeated epithet-and-noun phrases may have been deliberately chosen for dramatic effect, understanding the Iliad as an oral poem means that we must be ready to allow for the possibility that the choice is just an improvised coincidence to suit the meter. That said, we should not alter our reading in such a way that the Iliad requires some sort of unique approach beyond traditional literary criticism, for it is highly unlikely that the all or even most of the Iliad is just a combination of stock phrases and thematic conventions. The work can still be appreciated, as it traditionally was, for variation and originality even when we acknowledge that the author was not a literary writer, but an oral composer. In other words, there is no need for an exclusive 'oral poetics' approach to the Iliad.
- M.S. Silk, Homer, the Iliad (1987) 14
- R. Janko, 'The Homeric poems as oral dictated texts', Classical Quarterly 48 (1998) 4
- Homer, Iliad I 84
- Ibid. 148
- Ibid. 215
- Ibid. 364
- Ibid. 489
- Milman Parry, L'epithèt traditionnelle dans Homère (1928),16;
- Homer, Iliad III 370-384- where Paris is rescued by Aphrodite from battle.
- Homer, Iliad, translated by E.V. Rieu (2003)xxviii
- Homer, Iliad V 576
- See  24
- F.M. Combellack, 'Milman Parry and Homeric artistry', Comparative Literature 11 (1959)- 193-208
- Martin (1989. 35)
- Homer, Iliad VII 375
- Homer, Iliad XXIV 75
- B. Lord, The Singer of tales (1960) 145
- J. Griffin, Homer, Iliad IX (1995) 34-35
- See 
- See  4
- Homer, Iliad XVII 698
- See  22
- See  Ibid.
- Homer, Iliad V 511-522
- M. Mueller, The Iliad (1984) 13
B. Lord, The Singer of Tales(1960) 141-157
M.S. Silk, Homer, the Iliad(1987) 13-26
M. Mueller, The Iliad(1984) 7-27
R. Janko, 'The Homeric poems as oral dictated texts', Classical Quarterly48 (1998) 1-13
F.M. Combellack, 'Milman Parry and Homeric artistry', Comparative Literature11 (1959) 193-208
S.L. Schein, The Mortal Hero: an Introduction to Homer's Iliad (1984) ch. 1
J. Griffin, Homer, Iliad IX (1995) 32-35
I. Morris and B. Powell (eds.), A New Companion to Homer (1997) 146-173
R. L. Fowler (ed.), The Cambridge Companion to Homer (2004) 117-138
Homer, Iliad, translated by E.V. Rieu (2003)
Reading the Laments of Iliad 24 (http://classics.emory.edu/indivFacPages/perkell/files/PerkellReadingLaments2.pdf).
Milman Parry, 'L'epithet traditionnelle dans Homère' (1928)