Hi Edward,
External Signal activity is used in the scenarios when you have a dependency of one workflow on the other .Or the execution & completion of first workflow acts as a trigger for the second one.
For e.g. A data import is performed for one of the schemas in the first/source wf and once the import job is completed second/destination wf is triggered which is designed to do some other updates on the already imported data.
The wfs' perform in a sequential manner.
Note : the destination wf should be started manually because only then the external signal will be activated and gets triggered upon the successful completion of the source wf.
Hope this helps.
Thanks,
Anita