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A CNO is automatically created during cluster setup. When the administrator creates a failover cluster and configures clustered services or applications, the Create Cluster Wizard creates all the Active Directory computer accounts the failover cluster requires and gives each account specific permissions. The wizard also creates a computer account for the failover cluster itself; this account is called the cluster name object.
The CNO is important because other accounts are created through it. If the CNO is deleted or permissions for the account are changed, other computer accounts required by the cluster can't be created until the CNO and correct permissions are restored.
Beginning with Windows Server 2012, both the Create Cluster Wizard and the PowerShell cmdlet New-Cluster allow administrators to decide which organizational unit (OU) should contain the CNO.