User groups are a useful way to categorize users. Users can be assigned to groups in any combination you like, and each user can belong to multiple groups.
For example, if you have Technicians working multiple shifts, you could create a group for the 'First Shift Techs' and another group for the 'Second Shift Techs'. Groups can be used to filter team scheduling views and for sending a notification to a whole group of users at once.