Let me list a use case below. Hope it helps. Here I'm trying to find the Table Owner of the Table 'Stud_dtls' from the DB 'Students'. As Mikael mentioned, sysname could be used when there is a need for creating some dynamic sql which needs variables holding table names, column names and server names. Just thought of providing a simple example to supplement his point.
USE Students
DECLARE @TABLE_NAME sysname
SELECT @TABLE_NAME = 'Stud_dtls'
SELECT TABLE_SCHEMA
FROM INFORMATION_SCHEMA.Tables
WHERE TABLE_NAME = @TABLE_NAME