In addition to the conventional MT/miss, the SMG system has :
a high-pressure electric pump (gear select & engage)
a hydraulic power shifter (gear select & engage)
a clutch-operating piston and cylinder
a centre-console-mounted gear selector
an additional ECU (electronic control unit) that talks to the
engine-management microprocessor.
There is no clutch pedal...

The t/miss ECU takes in messages from the gear selector (also inputs about accelerator position, clutch disc speed, wheel speed etc.)
From this info, the control unit optimises clutch and hydraulic power shifter, operating the gear-selector shaft as the shift lever does in a conventional box. To protect the engine, you cant downshift if the car's speed is too high.
When the car comes to a standstill, first gear is automatically engaged. There's no automatic upshift if max engine revs are reached in low gear,driver must select a higher gear or rev limiter cuts in as normal.

With the software already in the system, a fully automatic mode is also provided. It operates in the same way as a Tiptronic automatic would do.
You have two parallel slots for the gear selector:
left one for sequential manual operation
right one for automatic mode, which also has Neutral (used when starting engine) and Reverse positions. No Park position because first gear stays engaged when engine is off. With engine running and shift lever in automatic or sequential slot, first gear is automatically engaged. As soon as the driver opens the throttle, clutch takes up smoothly (as if
driven by a good driver).But, dont have to lift off when changing into second. ECU cuts engine power by retarding ignition or cutting fuel to some cylinders. (so upshift is smooth and fast.)
When shifting down, if the wheel speed is too high, engine automatically speeds up. (bit like double de-clutching)

Hope that helps?
John