Sub-docs are documents that can be created within other (parent) documents. They can be useful for adding information that only makes sense in the context of the parent.
When searched by their title or contents, sub-docs will show up in search results, but won't clutter up folders while browsing for information. For example, a procedure that has multiple pages of reference information can become unwieldy to look at in a document folder.
Keep in mind that sub-docs will always be sub-docs. They can't be promoted to parent (nor can a parent be demoted to child).
To add a sub-doc, click the Add sub-doc button in a document: