When you have an SP in his starting slot, he pitches to whatever limit you set then the sim replaces him with your long reliever or short relief, depending on whatever your settings for them are and the game situation.
When you set up a Tandem A and Tandem B, SP A will go to his limit then be replaced directly by Tandem B, not the first LR. Game situation then determines when Tandem B is replaced.
(Rule is that Tandems can only be placed at the end of your rotation. ie if you have three starters and one tandem, it has to go SP1, SP2, SP3, T4A/T4B.)
Generally it's intended to be used with SPs who aren't capable of high pitch counts. I use it often in the low minors, where you get pitchers like 20 DUR/50 STA. Sometimes I have a full rotation of tandems in those cases.
I've also seen it used to vulture wins for good pitchers. Team sends out a decent starter for the first three innings then lets the stud handle the middle three or four.