If you are using the above design, you can assign 7 bit parallel data port to your parallel data and it will transmit trough the serial port (if it is a transmitter), the serial data coming from the transmitter is decoded and generated the 7 bit parallel data output(if it is a receiver). One another thing is that here 7:1 parallel to serial and 1:7 serial to parallel is happening, like that there are 4 channels are there. You can selects the number of channels as 1, 2, 3 or 4 by simple modification in the code.
One you run the reference design simulation you will understand the concept well.