It refers to employees who are ambitious, but whose ambition is directed towards great outcomes for their company - and out of that, great outcomes for themselves. That attitude in employees (especially senior employees and leads) is critical if companies are to make good decisions and stay successful.
While hiring employees with that attitude is key, what I've realized is just as important is maintaining an environment where these employees feel they will be rewarded for keeping that attitude.
I realized this when I was talking to a younger person (I've also realized I'm often the older person in a conversation now :-)) whom I've always believed had those qualities. But this time he was asking for advice on exactly the wrong things - about how he could get ahead and not what the right thing to do was and how to get it done. I knew he didn't start this way, and I also realized it wasn't entirely his fault.
When promotion systems and how employees are rewarded no longer matches what's best for the company (which can happen surprisingly easily), even employees that came in with the right kind of ambition start losing it. If fact, its worse. That ambition that they came in with starts to morph into something thats terrible for any organization.
If employees don't see enough evidence that doing the right thing for the company is rewarded (or welcome) and start believing that fighting for what they believe to be right will actually make it harder for them to rise, their ambition starts to morph. They start focussing on how to get credit for what was going to happen anyway rather than try come up with ideas, they spend more time thinking about how they can maximize their visibility to leadership, and how they can support conventional thinking rather than help shape the right decisions or products. The worst kind of organizational politics starts to dominate where they spend their time and effort.
So while as a leader you can manage a lot of this by following the advice in Ben Horowitz's earlier post on promotions, the thing to keep in mind is to build an environment within a team where as a leader you're always open to new ideas from everywhere, able to change tracks if the ideas are right, and then reward them.