The rationale is that if you're a voter and you vote for number one, number two, and number three, obviously that indicates that you have preferences other than number one, in the first instance. There's someone else you would like to see selected. You'd like to see this person selected first, this one selected second, this one selected third, etc.
You determine the quota. So your first person got to number one and has surplus votes. The idea, then, is to look at those ballots that are surplus to that and ask, what were the second preferences for those persons, and transfer those votes out so that those votes are no longer wasted. In a “first past the post” system, with the votes, once you get over the 50% threshold, whether you get 51%, 87%, or 98%, anything above 50% doesn't count any more.