Look at the illustration, to follow Maxine’s explanation.

Precondition
Substitution only occurs if the precondition is met.
In the example, substitution is applied to all assets of company code 1010 that are classified as asset class 5000 LVA. The substitution occurs when the asset is created or changed.
Substitution
In the substitution, the field to be substituted is specified. In the example, it is the target field; BaseUnit for base unit of measure.
It is filled by a substitution type. In the example, it is filled with a constant. Here, the constant is PC for pieces.
The Overwrite option is selected, which means that any value in the field will be overwritten.