From the way I understood the preview, (and please correct me if I'm wrong) the formations are mainly going to be used by the AI. Instead of every faction's armies using a single line (which the AI does 90+% of the time in vanilla) they will each use one of the formations featured in the preview in their initial battle layout.

Of course, that still leaves plenty of opportunity for the AI to goof it up. And the army needs to have the correct types of men to make the formation. However, the team reported, and many of us suspect that the formations will make fighting battles more difficult, and add a sense of difficulty and tension that the original campaign never had.

Note: This entire post was written from memory. Any team members or informed others should feel free to correct anything that I've remembered incorrectly or are otherwise wrong on.