On the balance wheel sits an optical sensor capturing the 28,800 vph oscilation, over a period of three seconds.  This sensor is trigger manually by a button on the left side of the case.  There is also a 16,000,000 hertz electronic oscilator that provides the EMC performance baseline, against which the in-house Urwerk movement is measured.  Finally, there is a computer that compares the rate of the movement vs. the electro oscilator, and expresses the difference as a rate gained or lossed per day.  The monitor and computer are powered by a micro-generator produced by a company called Maxon, who has developed motors for NASA Mars rovers, and the like. 

Should you want to adjust the rate of your watch, there is a fine-tuning screw on the caseback.  Still not sure how it works? This should help: