<type name="Magento\Customer\Ui\Component\DataProvider">
    <arguments>
        <argument name="reporting" xsi:type="object">
            CustomerGridCollectionReporting
        </argument>
    </arguments>
</type>

This is a type configuration.

This configuration is for the adminhtml area. This is the area that corresponds with the Magento admin sub-application.

This configuration tells the Object Manager that when a user wants a Magento\Customer\Ui\Component\DataProvider object that the following arguments should be used in the foo object's constructor.

• $reporting = new CustomerGridCollectionReporting (...)