It means that if you both have 2 diamonds and on the board there's three diamonds the highest card that one of you two has is the highest flush. For example if the board is Ad9d10h3d7s and your hand is Kd5d and the v has Qd7d you win because you have the Kd making your flush the highest overall flush (AK953) which is better than the AQ973, K>Q in this case.