Create new to add a new supervisor. (This can't create a new person, it only makes an existing person somewhere in VSys into a supervisor.) Click on a person's name to edit their profile in a new window, or Edit to modify their supervisor status.
Checking Inactive only makes the person an inactive supervisor: it does not affect their Active status as a person.
Checking Delete does not delete the person, it only removes them as a manually defined supervisor. (If they're the Supervisor of an assignment, job slot or hours record they're still a supervisor.)