A tree is cut down. When the wood is still green or wet, the log is debarked. The log is then slit or peeled into ribbons the length of the log. The veneers as they are called are graded for knots and grain structure excetera.
The veneers are then moved to a press and glue up machine. There, depending on the class of sheet required the face veneer is payed down. Then the inner veneers are payed down in an alternating pattern so that the grain crosses. This is what gives the final sheet it’s structural strength. As each veneer is laid, it is sprayed with a glue or bonding agent. Once the correct number of veneers are layered, a top face veneer is added. Then the entire stack is placed inside a heated press where extreme pressure and heat is used to thickness the sheet to final size and to cure the glue. After a period of time, the sheet is removed from the press and inspected. If it passes initial inspection it is sent to the finishing area where it is cut to size… typically 4 ft x 8 ft in the US. It is then graded again. If it is perfect it is sent to final sanding. If it has cracks in the surface veneer or knots that need to be filled it is sent for rework for voids to be filled and final sanding.
the sheets are then final graded for each face. Labeled as such bundled according to grade and shipped to the customer.
this answer is a quick outline of generic plywood manufacturing. There are many details not covered as this is not a place to write a book. This msg like species of tree, final grading of plywood, types of plywood for things like siding vs furniture. Pressure treating for ground contact, VOC and formaldehyde constraints on adhesives add many charters to a book on how to make “Plywood”