The standard Notify activity is an "assignment" based activity. Typically, when the assignment is created, the Notify activity is executed.
In keeping with Pega best practices, Activity rule records are small and modular. Once executed, the CorrNew activity calls the Like many activities, the Notify activity is the beginning of a string of several activities. Each activity has individual steps that are executed but here's the series of activities that are called from Notify I suggest you open the Notify activity rule record itself and read the activity. It will enlighten you.:
If you open the Notify activity itself, you will see in step 2 that it calls another activity called CorrNew.
CorrNew activity calls the standard activity CorrCreate.
CorrCreate (which is quite extensive and powerful) calls the standard process flow named VerifySendCorr displayed here for summary:
In the above flow, the CheckVerifyNeccesary Utility shape calls the standard activity named CorrVerify which determines if secondary user verification is necessary.
If no secondary user verification is necessary, CorrVerify activity escapes the flow by calling a standard activity named CorrAttach, which attaches the history note to the case audit trail.
If secondary user verification is necessary, the VerifySendCorr flow continues and after the verification assignment, the CorrAttach activity is called, which attaches the history note to the case audit trail.
I personally find the best way to determine what an activity does is to open the rule and read through it and it's called activites. For instance, find the standard Notify activity rule, then use the Actions menu and choose Preview. The following two images show those steps.
When an activity calls another rule record, that rule instance is shown as a hyperlink (such as CorrNew above). Repeating the investigation helps the architect to fully understand the string of activities and other related rules being invoked.