Exodus 18:17, "Moses' father-in-law said to him, “The thing that you do is not good," is a pivotal moment where Jethro (also called Reuel), Moses' father-in-law, observes how Moses is leading the Israelites and offers some sage advice. To understand the verse's meaning, let's break down the context:

The Situation: Moses was tirelessly judging disputes among the Israelites from morning until evening. He was the sole arbiter for every single issue, big or small.

Jethro's Observation: Jethro, having heard about all that God had done for Moses and the Israelites, visited Moses in the wilderness. He saw the long lines of people waiting for Moses' judgment and noticed Moses' exhaustion.

The Meaning of "The thing that you do is not good": Jethro wasn't criticizing Moses' character or his intentions. Rather, he was pointing out the inefficiency and unsustainable nature of Moses' current method of leadership. It was "not good" because:
Moses was wearing himself out: He was spending all day resolving every issue, leading to exhaustion and potential burnout.
The people were also wearing themselves out: The people were forced to wait in long lines, taking up their whole day just to have their cases heard.
It wasn't a scalable solution: As the Israelite population grew, this system would become even more unmanageable.
Moses was unnecessarily bearing all the burden alone: God had given the Israelites many capable people, and Moses was not utilizing them.

Jethro's intention: Jethro's comment was constructive criticism, aimed at helping Moses be a more effective and wise leader. It wasn't a condemnation, but a loving and insightful observation from an experienced elder.

In short, Exodus 18:17 is a warning that Moses' current leadership method was unsustainable and inefficient. Jethro's counsel leads to Moses delegating authority and establishing a system of judges to handle less significant cases, freeing Moses to focus on the most important issues and on leading the people closer to God.