How do you define the hadith? What is the significance of the hadith literature as the source of the Shari'ah?
These are two different questions. I am giving an excerpt below from the first chapter of Mr Ghamidi's book Mīzān. I hope it answers both of your questions. Javed Ahmad Ghamidi writes:
The Prophetic Hadīth, a name given to the reports about the sayings, actions and tacit approvals of the Prophet (sws) transmitted through individual to individual (akhbār-e ahād) do not add to the beliefs and practices in the religion. It does not mean that they do not discuss the contents of the religion at all. However, their purely religious content explains and clarifies the religion housed in the Qur'ān and the Sunnah. They can also carry the paradigmatic example set by the Prophet (sws) in the performance of the religious practices and in carrying out the divine commands. The Hadīth plays no role beyond this. Thus a report bearing religious knowledge in ways other than this cannot be a valid Hadīth. Nor can such a report considered part of the religion and accepted as such merely because it has been attributed to the Prophet (sws).
All the Hadīths that explain and clarify the religion and thus plays the acceptable role have a binding religious force for a believer who is convinced of the veracity of a Hadīth report and believes it to a valid transmission of a saying, action and tacit approval of the Prophet (sws). He is obliged to follow it and can no more validly contradict it. Rather if the Hadīth in question contains a Prophetic command, it becomes necessary for this believer to unquestionably submit and surrender before its verdict. (Fundamentals of Understanding Islam)
The word 'sunnah' in this passage has been used as a specific term. Some of the constituent parts of the religion given by God through the Messenger are laid down by the Qur'an and some others have been instituted by the Prophet (sws). The word sunnah in the above quoted passage stands for the latter. We find the Qur'an mentioning them yet the Book does not introduce them. Rather it refers to them and takes them for granted as well-known and established parts of the religion.
(Translated into English by Abid Mahmood)