If the router cannot locate a configuration file (on a new router for example) it will start setup and it will ask if you want to enter the initial configuration dialog, if you answer with No, you'll be taken to the command prompt and you'll be able to configure the router manually. If you answer with Yes, you'll be taken through a list of questions allowing you to configure the router e.g. set a hostname, enable password and enable secret, configure routed and routing protocols and interface addressing. You can also initiate this configuration dialog using the command: setup.