The animation shows a surgeon opening up the scrotum, removing the testicles, and removing the head of the penis (hello, nerve endings) to create a clitoris. The shaft and the scrotum are then used to create the labia and vaginal canal that will allow a lot of patients to have a perfectly healthy and great sex life.
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Obviously, these are only the surgical changes and additional hormone therapy is necessary for a variety of other changes in the body, but watching a little animated hand transform one biological gender to another is truly fascinating.
On the other hand, recent developments have also happened with female to male surgery, with the first penis transplant in the U.S. slated to happen at Johns Hopkins University School of Medicine on a wounded soldier who sustained a genital injury. Sadly, the transplant is only available to men injured in combat and not transgender men.