The purpose of phase 1 obedience training is to teach the meaning of new commands to the dog.
This will be done only by giving and taking away rewards (food, affection, play, etc..) to shape the new behavior. Any form of physical correction is avoided at this time.
In addition, techniques are mastered to maximize the reliably and length of time the dog will obey each command without the need to constantly give rewards (also without physical correction).
By starting off this way, the dog will understand that obedience is primarily a good thing that is meant to help him get what he needs and wants out of life, before the dog learns that he MUST obey.
Ultimately, this makes the training experience less stressful for the dog and more enjoyable.
But, because the dog's motivation for obeying is to get what he wants at this phase, you cannot expect the dog to obey when he wants something OTHER than what you have to offer.
Phase 2 is where you formally teach the concepts of discipline to the dog.