CakePHP allows you to set up a combination of controllers, models, and views and release them as a packaged application plugin that others can use in their CakePHP applications. Have a sweet user management module, simple blog, or web services module in one of your applications? Package it as a CakePHP plugin so you can pop it into other applications.
The main tie between a plugin and the application it has been installed into, is the application's configuration (database connection, etc.). Otherwise, it operates in its own little space, behaving much like it would if it were an application on its own.