How did the caste system play an important role in society?

There is no easy answer to this question. There Caste System developed a hierarchal system where everyone has a 'place' in society that one can find is difficult to get out of. The social boundaries developed are segregating, at times, and political decisions are often based on caste levels.

The caste you were born into, you could not escape, and you remained there for the rest of your life. Not only that, you were treated in accordance with your placement in the caste system.

The caste system sets up social boundaries, which in turn, sets up economic boundaries as well, for the entire society.