As Ian said,
A VPP is a propeller that can change it's angle of incidence and thus angle of attack so that it can vary to an optimum coefficient of lift for a particular operation i.e. cruise or take-off.
This is a benefit over a fixed pitch prop that has it's angle of incidence set at an optimum angle for one operation only. This is usually cruise as you spend more time cruising around than taking off, although the take-off performance will be slightly degraded.
The CSU automatically controls the VPP so that it maintains a certain RPM by varying the pitch depending on the engine torque and load applied to the prop. This is to maintain the engine RPM at a certain value that gives the best performance/economy.
I think the Diamond Katana has an electrically operated VPP that has 2 settings only i.e. take-off (fine pitch or 1st gear) and cruise (course pitch or top gear).