They also help to provide a rather hidden area of literature to the public. A workshop is a group of people getting together in a theatre, often a director, an artistic director and several actors and a tech person to run through the play and tell you what works according to them and how it should be written so that it would make sense in their lives. A good workshop looks at the play that is there and points out what is needed to get past any blind spots the playwright has so that the audience gets it. They explore alternatives on how to make this a great play that will just knock the socks right off any reviewer that comes to the play when it is in full production. Some theatres want options on your play if they do this for you and a percentage of the house for a specified period of time.
People have workshops with their local theatre guilds, too.
Workshops are a part of a play's history and should be duly recorded and presented with submissions.