The big cheese is the person who holds the most power in any situation. If you overhear someone at work describe you as "the big cheese," it means that he thinks of you as the most important person in the office.
You might also call someone important the head honcho or the top dog. The idiomatic phrase big cheese comes from a definition of cheese that comes from Urdu, in which chiz means "a thing." The British colonization of India brought English speakers and Urdu speakers together, and one result was the phrase "the real chiz" to mean "a big thing or event." This evolved over time into big cheese.