What is mean of setting timing constraints for my design in TimeQuest?

When I read the tutorial about TimeQuest from Altera, most of the tutorial shows me how to set constraints for clock and other signals. I am a little confused about the usage of TimeQuest and now I hope I can firstly get a macro understanding about the usage of TimeQuest.

As my understand, the TimeQuest has two major functions:

1. I set timing constraints for different signals in my design, then QuartusII will fit my design based on constraints to meet the time requirements.

2. After full compile. TimeQuest will analyze the timing performance of design completely, then give the report for check whether the constraints have been met or not. If there are problems, we can modify the design based on the report.

I hope anybody who is familiar with TimeQuest can help me. Is my understanding right? If not, please explain to me and help me understand.

Thanks very much!