Enzymes are proteins that react with and convert starches to sugar, or at least that is the simple explanation. There are two main enzymes, Alpha Amylase and Beta Amylase. The idea is to utilize both of these enzymes to convert starches to sugar in the mash.
Alpha amylase requires a temperature range of 145 to 158F to convert starches to sugars and requires calcium as a co-factor. This enzyme also converts insoluble starch molecules into smaller soluble molecules.
Beta amylase breaks down starch and creates maltose, and produces large amounts of fermentable sugar. It is active in the 131-149 F degree range. At 149F it is working at its fastest rate but it is also becoming denatured. Letting a mash stand in a range where Beta amylase is active provides for a more fermentable wort. Rasing the mash temperature above 149F will completely denature the Beta amylase and result in a less fermentable wort.
Temperature Rests in a Mash
113 F to 122 F Protein and Beta Glucanase rest
144F to 149 F Fermentability Rest
158 to 167 F Extract Rest
172F Mash-off temperature
The Protein and Beta Glucanase rest is not necessary when using highly modified malts, and may be skipped, though it doesn't hurt anything to do it, and I have found that it activates the enzymes and allows them to complete sugar conversions more quickly when arriving at the higher rest temperatures.
I like to add water gradually, resting the mash after each addition of water. It helps that malts are fully modified these days, and adding the water a bit at a time prevents overshooting mash temps. The first water addition just gets the grains wet and ends up in the 110 to 130 F range. I let the temperature stabilize then add more water, measuring the temperature along the way. I try and mix the mash to eliminate any hot spots.