{t}Groups are simply a set of permissions that accounts can be authorized for. Each group is simply a list of methods that accounts associated with the group can access.
For example, if a particular group is authorized for the Account Administration methods, any account authorized for that group can access the Account Administration features.
The group configuration is very flexible. For example, a group can have access to only some of the methods in a specific module. So, group(s) can be define for employees that allow them to view and search for accounts, but not to delete or edit them.
The group hierarchy also allows for an unlimited number of child groups defined under a parent group. Those child groups can then have children of their own. The advantage of this system is that the child group(s) always inherit all it's parents permissions, and then you can add additional permissions to the child. This makes it possible to very quickly create a group that has all the permissions of an existing group, plus a few changes.