Intel Speed Shift technology also known as HWP (Hardware p-state) or Hardware Controlled Performance delivers quicker responsiveness with short duration performance shifts, by allowing the processor to more quickly select its best operating frequency and voltage for optimal performance and power efficiency.
For performance, efficiency and power consumption reasons, modern processors are constantly changing clock frequency and voltage based on the workload. In order to receive performance hints (p-states) and adjust performance according to the operating system, application or user needs, processors prior to Skylake model are relying on the operating system. The problem with this approach is the level of latency that is added to the performance adjustment process, which slightly reduces overall performance as a result. One can certainly avoid this problem altogether by selecting for instance, maximum performance. However, this will can reduce the battery life for portable devices, increase power consumption, and thermal output.
Starting with CPU codename Skylake, the problem with performance control adjustment was addressed with Speed Shift (Hardware Controlled Performance) also known as Intel HWP (Hardware p-states). With Speed Shift enabled, CPU takes over the responsibility of frequency control, which will be done on a hardware level by the CPU itself, this’ll allow much faster p-state transitions and can drastically reduce latency during the process of p-state selection.
NOTE: that transitioning from one p-state to another is still not instant and/or resource free.
That being said, even with Intel Speed Shift support enabled CPU will not be able to jump from low to high frequency level and back instantly, due to various factors such as voltage, heat, data coherency etc. So if you do want/need the absolute best out of your CPU, you'll still have to set performance to maximum manually. This'll disregard the scaling part of the process and will be effectively the same as setting multiplier to maximum.