This is a very very good question. How it impacts is say but what it tells us as a means of benchmarking is quite a lot.
TRI actually tells us how much the index has made by including all the components of returns like dividends, rights and bonuses etc which help us to correctly ascertain index growth rather than price differential composites over two dates. Now, the fund manager or investor, who takes the benefits of these added value into her portfolio, will be actually able to find out how effectively she has beaten the chosen benchmark, entailing extra efforts, time, money spent or would she have been passive into a benchmark and made more money.
It s actually a lot more than this short post but I hope I could clarify some bit.