Kies is a lot of things. It's a way to sync and backup your contacts and device data, it's a front end for transferring media like music and video between your computer and your phone, and as you've noticed, it's a method to update the device firmware on Samsung phones.
Using it is pretty easy. Install it on your computer (Windows or Mac), then plug your phone in with the provided USB data cable. Kies will find it, and present you with a fairly simple user interface full of things you can do with it. On Windows computers, Kies includes a set of universal device drivers so you don't have to fool with that, and it will automatically recognize your phone in case you have more than one.
Most power users only use Kies for firmware updates, and even then only when it's required. Because all the features are available without Samsung's fancy front end, there's no real reason to install yet another software suite to your computer if you don't mind doing things the manual way. We're just glad users have a choice to use it or not to use it
