Webpack-chain simplifies webpack configuration using a chainable API instead of directly manipulating the config object. It offers a more readable and maintainable approach to defining complex webpack setups. By providing a fluent interface, developers can easily modify loaders, plugins, and resolve configurations. Webpack-chain improves code clarity, reduces configuration errors, and allows for easier webpack config reuse across multiple projects, leading to a more streamlined and efficient development workflow for webpack-based applications.