Update README.md and add how it works section

doc/how-it-works.md

@@ -4,12 +4,27 @@ This document describes a high level overview how jenkins-operator works.
 
 ## Architecture and design
 
-![jenkins-operator-draft](../jenkins-operator-draft.png)
+The Jenkins operator design incorporates the following concepts:
+- watches any changes of manifests and maintain desired state according to deployed custom resource manifest
+- implements a main reconciliation loop which consists of two smaller reconciliation loops - base and user 
 
-## Base configuration
+![reconcile](../reconcile.png)
 
-## Jobs managed by jenkins-operator
+Base reconciliation loop takes care of reconciling base Jenkins configuration, which consists of:
+- Ensure Manifests - monitors any changes in manifests 
+- Ensure Jenkins Pod - creates and verifies status of Jenkins master Pod
+- Ensure Jenkins Configuration - configures Jenkins instance including hardening, initial configuration for plugins, etc.
+- Ensure Jenkins API token - generates Jenkins API token and initialized Jenkins client
 
-## Backup and Restore
+User reconciliation loop takes care of reconciling user provided configuration, which consists of:
+- Ensure Restore Job - creates Restore job and ensures that restore has been successfully performed  
+- Ensure Seed Jobs - creates Seed Jobs and ensures that all of them have been successfully executed
+- Ensure User Configuration - executed user provided configuration, like groovy scripts, configuration as code or plugins
+- Ensure Backup Job -  creates Backup job and ensures that backup has been successfully performed
+
+![reconcile](../phases.png)
 
 ## Operator Status
+
+Operator status is used for storing any configuration events or job statuses managed by the operator.
+It helps to maintain or recover desired state even after operator or Jenkins restarts.