In short, there are 4 zones. There is the rout zone, the defend zone, the attack zone and the assault zone. You win the battle by outnumbering the enemy on the field by 4-1. Each 'turn' every unit makes a morale check to determine if it goes back to the rout zone.
Being in the defensive zone proffers modifiers for morale and reduced casualties at the expense of inflicting casualties. It is 2 ranks deep so you can shield a unit by putting it in the second rank. There is the attack zone which I like to consider the normal zone offering average modifiers to attack and defense and then there is the assault zone which is heavily weighted to attack yet offers the most risk of taking casualties and being routed.
On top of that, units are good in different zones. Standard infantry has no bonuses or penalties in any zone while Jagers are good on attack, and Light infantry are good on defense. Cav get a bonus attacking infantry in any zone but defend where they get a penalty. Lancers though have a much lesser penalty and thus are good for busting up infantry anywhere.
You control the starting zone but the AI takes over from there as units can move between zones (an obvious example is rout and rally).
There's more rules but they are all covered in the manual. Let me start showing you some shots. Here is a shot of my Jager unit. Notice that I have only one training upgrade, bayonets.
