DOES A DISC NEED TO BE CROSS-DRILLED AND SLOTTED?

Not necessarily. The processes achieve slightly different ends.

Let’s talk about cross-drilling first. When the friction surfaces of a rotor are smooth and flat, there is no means of escape for the gases and dust that build up between pad and rotor. At very high braking temperatures, the bonding agents used in some brake pads can produce a gas which creates a pneumatic cushion between pad and rotor, giving a driver a normal pedal feel but reducing the amount of friction being generated. This is not a huge problem in normal motoring but is an important consideration in street performance applications.

The bigger the pads and the higher the braking temperatures, the more likely the problem. The drill holes assist with this 'out gassing'. The holes are also commonly labelled 'cooling holes' because of the improvements they make in this
area. Better cooling means less fade during repeated heavy brake applications.
Obviously, the holes reduce mass. They also help dissipate water when driving in poor weather.