In computer networking, a server is a computer designed to process requests and deliver data to other (client) computers over a local network or the Internet. Network servers typically are configured with additional processing, memory and storage capacity to handle the load of servicing clients.
Having a server on-premises gives a host of features not only to centrally store files but to centrally administrate client computers that connect to it. Whether they are local clients or remote workers, they will connect to the server to authenticate before they are allowed to view shares or email.