The goal of a bibliographic system is to insert into a paper a properly formatted reference for each paper which the author cites. It's important to make sure that
You COULD do all that by hand ... typing sequences of characters like
Smith and Jones (2003)
and then adding the proper list of authors, journal, volume and page and year in the bibliography ... but it would be easy to make mistakes.
Remember this repetitive incantation, and all will be well:
latex paper.tex bibtex paper latex paper.tex latex paper.tex
Here's an example: