This feature allows you to run an existing test as a single step within another test. This can help to reuse common automated test steps in the project. We like to call this test modularization. This means breaking up your testing tasks into modules that do specific small functions on their own, but do not perform the complete end-to-end testing scenario.
As of version 2015 R1 you can find the custom steps in the Step Builder under General section.
Here is a sample project for Amazon.com:
Here is a sample Login test:
Once the test modules are in place, add them to high-level tests with the Test as Step function. Next I open the AddToCart test and add the Login test to the beginning of it.