Move the lever up and hit the green "left" arrow to add "1" to the binary makeup of the letter, and move the lever down for "0". When you have eight digits that correspond with a letter in the key, hit the green "down" arrow to add the letter to the second display. To add another letter, just start adding the next binary sequence. To delete a letter, hit the red "X" above the letter display. To delete a binary number, hit the red "X" above the binary display.
This is what goes on behind the scenes inside a computer.