The basic steps for operating a PHD are the following:
0) Before you dig, put a piece of colored tape on the auger to mark the depth you want to dig. This will let you check the depth from your tractor seat (don't forget that when you dig you'll pile up some extra dirt around the edges of the hole, making it seem like you've hit your tape before your hole is deep enough)
1) With the PTO disengaged, center the tip of the auger over the center mark of the hole you want to dig
2) Lower the auger until the tip presses into the ground right through the center mark for the hole
3) Ease the tractor forward about 3-4 inches, making sure the auger tip stays put in the center mark of the hole (you want the auger to lean slightly at first so that it will straighten up as it goes deeper into the hole)
4) With the tractor at idle or just above, engage the PTO gently and lower the lift arms on your three point hitch
5) About half way down, you may want to lift the auger (not completely out of the hole) to spin off some of the dirt, then lower it again to keep digging
If you're digging in rocky soil, make sure you have a handful of extra shear bolts handy -- you'll likely need them. I'd also keep a pick and/or shovel if your rocks are big. Small rocks are no problem. Bigger ones (volleyball size and bigger) usually have to come out by hand once you hit them.
Good luck.
Parker