Internal linking is very important in SEO. One of the first things you can do is change the link to your front page. Most people put “Home”. You should change that to your keywords like widgets or my service or whatever term you are trying to get on your front page. You could even have a different keyword per page. Another mistake is people put the link to their home page as /index.html. Don’t do this your going to be telling search engines you have 2 front pages. They will see www.domain.com and www.domain.com/index.html as 2 pages and they will see them as duplicates. You will not be passing any of your internal link value to the home page. I try to use absolute URL’s. (i.e. http://www.domain.com/page.html) If someone hijacks your site they can only hijack one page this way. Every so often to hack comes out where somebody can hijack your site. It does not happen often but why risk it. Another thing I try to tell people is don’t put a link to your home page on your home page. You are just wasting space.
Next you want to have all your pages pointing to other pages on your site. If you have a small site with 10 pages or less you can just have each page point to each page. If you have more you will need to pick a number of links you want on each page. Then you will need to make sure that each page has that many internal links plus the link from the front page or directory page. So if your number is 6 then each page should have at least 7 internal links. Be sure that the links to each page have the right anchor text for that page.
This will give you the power of keyword rich anchor text to help boost each pages rank. It will also make sure that when you do rank for something you will get a second indented result in the SERPS because you have that keyword on at least 2 pages. It is good to organize the links into groups so that you also get more keyword density on the page that has the links.