The NoFollow tag is used to prevent search engine robots from transferring pagerank to a link. While the most common use of the Nofollow tag is to prevent spam in user generated content, it can also be used to "focus" pagerank within your website.

Allow me to elaborate: imagine your homepage as a flat board with a dozen or so holes drilled in it. You hold a pitcher in one hand which is filled with a magical juice called “pagerank”. The more holes you drill in the board, the less pagerank which will seep through each hole.

Now substitute “holes” for “links”. The more links you have leaving from a page, the less pagerank each of those links transfer. Therefore, using the “nofollow” tag is akin to plugging the holes; it forces more page rank at the links which are left open.

Begin by adding the nofollow attribute to non-important pages on your website: Privacy Policy, Terms of Service page, etc… Next, plug any external links which appear on every page, such as those of 3rd party authentication services (trust-e/better business bureau/ etc…).

Pretty neat, eh?