The config npm package simplifies managing application configuration across various environments. It defines a hierarchy of configuration files (default, development, production, etc.), merging them as needed. This allows developers to easily switch configurations based on environment variables, command-line arguments, or node parameters. It supports multiple file formats (JSON, YAML, etc.) and enables centralized configuration management, reducing code duplication and improving maintainability. config streamlines the process of accessing configuration values consistently throughout an application.