According to MS it:

"Microsoft Performance Management allows customers to monitor, analyze, and plan their business as well as drive alignment, accountability, and actionable insight across the entire organization."

http://office.microsoft.com/en-us/performancepoint/HA1016395...

I don't understand either.

It was their attempt at a more consolidated Business Intelligence app to compete with Hyperion, Business Objects, Cognos, etc. It had analytics, scorecards, budgeting & planning, and static reports all in a (SharePoint) portal. It wasn't so good.

The fact that we need to ask "what" explains "why."

Sounds like it's an OLAP tool built on Excel/SQLServer