Normally, when an application is running, it appears in the Dock. But sometimes you don't want this; for example, I don't want iShowU to show up in my Dock while I'm recording a screencast with it. In these situations, it's handy to be able to set an application to not have a tile in the Dock.
(Note, specific to iShowU: Recent versions of iShowU will actually revert your changes to it when you launch it, unless you write-protect its Info.plist file. This is not a bug in Configure Application Dock Tile. You can write-protect iShowU either by Getting Info on it in the Finder and choosing “Read only” from the Ownership & Permissions pop-up menu, or by installing iShowU to /Applications and then only using it while logged into a non-administrator user account.)