The use of flags can be quite powerful.
RHO opens 1♥ and you overcall 2♥, Michaels for spades and a minor. LHO bids 2♠, GF with heart support (2NT would have been limit). Partner bids 3♠, and RHO pops in a 4♦ cue. You want to compete to 4♠. Now, you could make a "Flag Fit-Bid" in this situation. 4♥ would be a raise to 4♠ showing clubs; 4♠ would thus show diamonds. That might help partner decide whether 5♠, passing, or doubling is right if the opponents compete to 5♥.
But, you may protest that disclosure is bad. OK, LHO cuebids 4♣ then. You could opt to bid 4♠ as a non-disclosing bid. Or, you could show the diamonds (4♦) but flag the clubs (4♥).
This same principle could occur at a lower level. After your Michaels 2♥ call, LHO passes this time, and partner picks 2♠. If his minors are 4-1, and he has Kx in spades, what do you expect? However, Opener makes a strange call of 3♦, alerted as a strong 3♥ call. Apparently, the opponents use transfers here, with 2NT as a transfer to clubs, 3♣ a transfer to diamonds, 3♦ a transfer to hearts (and strong), and 3♥ simply competitive. You like this, and you plan to discuss this idea with partner, but now you have a call to make. The auction may well not die at the three-level, but you may not want to enter the four-level yourself to show your minor. On the other hand, if partner knows your minor, he may be better positioned to consider a 4♠ sacrifice, or even a sacrifice in your minor, instead. Might as well take advantage of the opponents' techniques, eh? You know the drill now. 3♥ is a competitive raise to 3♠ with clubs as the second suit; 3♠ then shows diamonds as the second suit.
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