MacIntyre uses a watch as an example. A watch has attached with it a functional concept. It is expected to do something (tell time). The definition of 'watch' is both a definition of it as an object and its function. A good watch is a watch that functions according to its criteria for being a watch.
"Man" needs to have a similar "functional concept":
To be a man is to fill a set of roles each of which has its own point and purpose: member of a family, citizen, soldier, philosopher, servant of God. It is only when man is thought of as an individual prior to and apart from all roles that 'man' ceases to be a functional concept.
MacIntyre argues that in order for moral arguments to come from anywhere other than personal preference there needs to be a functional concept of 'man'. In fact, in calling someone 'good' implies that there is a function and purpose that he/she is fulfilling (just like a 'good' watch). 'Man' needs to have a purpose or telos so that he/she can work out not only where they are but also where they need to be. Without this functional concept morality falls into circularity and emotivism.