Most defenders will be hard-pressed to defend against multiple attackers operating simultaneously from different directions, and wily combatants will take advantage of this fact to give themselves an edge in combat. A creature is considered flanked if it is threatened (characters threaten all areas they can make melee attacks into - usually around a five-foot radius area around them) by two opponents roughly opposite each other. The exact rules of flanking in pen-and-paper Pathfinder are a bit of a bother: if you can draw a line between the center of two attacking characters and it passes through opposite sides of that creature, it's considered flanked. The rules employed in Pathfinder: Kingmaker are similar, and if you want to ensure you'll flank opponents, try to move your characters to opposite ends of the target.
Flanking attackers gain a +2 bonus to Attack Rolls against flanked defenders, which can help your warriors cut down even well-protected targets. For rogues flanking is more than a moderate boon, as they can deal Sneak Attack damage to flanked defenders. Melee combatants who wear no, light, or medium armor that doesn't have a high Armor Check Penalty may want to invest in the Mobility skill so they can flank opponents without drawing Attacks of Opportunity via use of the Acrobatics ability.