It depends on whether the coconut is young or old. Young coconut has a green husk (copra) and old coconut is normally sold with the outer layer removed. There are three things you can do with young coconut. The first is to remove the outer layer, dry it, and use it for fuel. The next is to hack the top off, crack the inner shell, sip the coconut water out, scrape the tender meat out with a spoon and eat it. The third is by far the best. Save the coconut water and use it to make an awesome fermented beverage called toddy!
There is only one known use for old coconut. Using a rasp, scrape the insides out and extract the milk using warm water and a cheesecloth. Most restaurants in the United States use canned coconut cream. This is by far the most stable and consistent product if one is unsure of the correct consistency of coconut milk.