What does this do exaclty and how does it affect daily driving?

 

If your talking about the timming on the crank, my understanding is it tells the injectors when to inject fuel. Our trucks have injectors that spray fuel into the cylinders more then once per power stroke. By increasing the timing, the fuel comes in earlier and provides better low end. According to several web posts, Cummins retards the timing for emmision reasons. How it works I do not know.
I Can tell you that I did the "Tone ring Mod" on my truck and picked up about 1-1.5MPG around town. The truck seems to have better pickup and a little more tourque under load. There is also a replacement timing sensor you can by from Rokktech.com that will advance your timming by 2 degrees. For me, I can't see spending the $$$ for a sensor when the mod was so easy and cost me nothing.