The outline designer is used for modifying the content outline of your course version.  To access the outline designer, click on the piece of paper with bullets on it in the left hand menu that says "Content Outline".  To add items to the content outline, click add content and tell the system what title and type you'd like to create.  This is used for rapidly generating instructional flows and having conversations around the structure of the material.

It also helps streamline the handling of all links and nesting of content as you can drag and drop items around based on how you'd like it structured.