Much of the training is taken up teaching people to do Observations or Lifesavers. The examiner will expect you to do these looks in the test for the right reason at the right time.
In essence an observation should afford you the opportunity to change your mind. In other words they should be done early enough that you can do something different, but late enough that events are not going to change too much. Generally, you would hope to see nothing when you do an observation, and they merely act as an insurance against the day that there is something to see. They should be done so that they do not upset the balance of the bike, or make you swerve.
There are five occasions when it is appropriate to do an observation:
i). Moving or turning to the right - including moving round parked vehicles, turning into a side road or changing lane.
ii). Moving or turning to the left - including turning into a side road, moving back to the left having passed a large stationary vehicle, pulling into the side of the road or changing lanes.
iii). Speeding up - either by going into a higher speed limit or pulling away from a standstill.
iv). Slowing down - again entering a lower speed limit, approaching a junction/hazard/roundabout or slowing to stop.
v). Where there is the potential to slow down - approaching green traffic lights, pedestrian crossings, unexpected hazards (horses) or in the event you feel you may have to stop suddenly (children playing by the side of the road).
FAQ
1/. How do I do an observation?
Easy - look in the mirror and then turn your head to look into your "blind spot".
2/. What is the difference between an observation and a lifesaver?
Nothing; instructors use the word Lifesaver to emphasise the importance of looking before you turn left or right from a main road into a side road. These observation more often than any other will save your life.
3/. If I miss an observation will I fail my test?
Possibly but in general it is a minor fault. However, if the examiner felt there was something you ought to have seen then it will be a serious fault. If you change lanes without observing then normally this would be a serious fault and you will fail.
4/. Can I do too many?
Yes you can. An observation is often a signal to other road users that you are about to do something. Doing them excessively will simply dilute their effect. Moreover, it pays dividends to look where you are going unless there is a specific reason for doing an observation. To keep a check on things behind a glance in the mirror is adequate.