What exactly is he/she implying?
Your hands are much like a paddle. When used correctly, paddles move a tremendous amount of water, causing a boat to move. When used incorrectly, paddles slide or slip through the water and do not meet much resistance. Little resistance means little propulsion through the water.
Swimmers want their hands to meet as much resistance as possible, grabbing water, holding water, pushing water, etc., to propel them. If the hands are turned on the side, they slip or slide, and the distance per stroke is diminished.
During practice, try focusing on your hands. Strive to feel pressure on them throughout your strokes. Ask your coach if you are "grabbing enough water" and certainly make sure you are not slipping and sliding.