how to enable shared login names between drupal sites

As I understand the situation, I go to modules, ensure I turn on that long paragraph about allowing other drupal based sites to share so to speak user name and password of users, ie. I imagine this function is all about if you have have logged into one drupal site, than you can use the same username and password to log into another drupal site.

I've checked this box at the module stage, than I've gone to settings, users to change the message a little.

What else do we need to do to make this work, I've tried it but doesn't seem tow ork. Is there a central drupal server that logs all these username and passwords created? Does it require cron to run?