Reading literary criticism is very helpful for understanding literature.
Literal
Literary-criticism [object-を] read [nominalizer-こと] [topic-は] literature [object-を] understand [purpose-のに] very is-helpful.
~のに here means 'for the purpose of' — 理解するのに (for understanding). 役立つ (やくだつ) means 'to be useful/helpful.' The sentence uses double nominalization: ~ことは (the act of reading) and ~のに (for understanding).