Manage App People General Page Explained

From the "Manage Application" > "Sites" > "General" page, you can create your own custom People category field. The category you create here will be available as a filter in the People Index page when clicking on the "People" icon on the left hand navigation.

To create a custom People category, click on "Custom People Category" and enter the name of the people category. 

An example of People category is "team". If your company has many different teams and each team include employees from different departments, then you can create a "team" category and people can select which team they are in within the profile. To find people in a certain team, you can click on the "People" icon on the left navigation, then select a specific team to find all the team members.