Due to the way fluids interact in a flow, the flow is often complex. For instance, in a stream the water at the top middle is moving faster than the water at the bottom or sides. This is because the water in contact with the earth experiences drag, slowing down the water beside it, and so on.
A streamline becomes important when such a flow is distrurbed by some solid object, like a rock in the water. In this case similar drag forces cause the water to move around the rock in a complex fashion. However for each point upstream from the rock, there is a particular path to the downstream side. This is the streamline.
Attempting to make as smooth a streamline as possible is a common task in engineering. A smooth streamline implies as little distrubance of the fluid as possible, and thus as little wasted energy as possible. For a vehicle moving through a fluid, careful design can lead to considerable improvements in economy or performance.
Engineers often use dyes in water or smoke in air in order to see existing streamlines, and then modify the designs to reduce the drag. This task is known as streamlining, and the resulting design is referred to as being streamlined. Streamlined designs are often esthetically pleasing to the eye as well.
The same terms have since become common vernacular to describe any process that smooths an operation. For instance, its common to hear references streamlining a business practice, or operation.