No, you don't have to use it for anything. I've seen feedback from several people in various threads who don't use mode for anything at all.
On the other hand, I find it very helpful in setting lighting levels at various times of day. I recently went from a very simple 3 modes (Home, Night, Away) to a more granular 6 modes (Home - Day, Home - Evening, Home - Night, Home - Morning, Away, and Night). I have Mode Manager set mode based on presence, time of day, and switch state. Then using Motion Lighting, Mode Lighting, and Rule Machine I can have various things happen when mode changes. As @ogiewon said above, it's just a global variable that changes based on your inputs, and you can trigger different things to happen with the change.
For me, I have everything shut off when mode goes to Away. I have most things shut off when mode goes to Night. I have ambient and motion lighting come on at different levels using the different Home mode variants. All of this could be accomplished without the use of modes, and some prefer to do it that way. I find it easier to use mode. But the best part, is we have the flexibility to choose what works best for ourselves