Woodson realizes Smith's potential, but he also realizes he has a very long way to go. To some extent, most of what Josh was doing in the summer leagues was due to his unreal athletism, which is scary. However, a player cannot make it in the league based on pure athletism. Josh Smith is going to have to work hard and consistently improve his game. That's all that Woodson is saying. And Woodson is not going to cut him any slack just because he is 18. That's a great way to be, because Josh needs to know that he is not there just yet.
Now just imagine if Josh gets a good grasp of all the fundamentals and learns how to play in the NBA. Wow.