As with all Apple’s OSs, updates are expected and will make the overall experience ... based devices which can update themselves with the Software Update feature, the Apple Watch is dependent on ... to My Watch, tap General and then the Software Update entry where you will be greeted by a large Apple Watch icon with a big sprocket inside, plus the size and version of the update.

This said, you should also know that in order to complete the installation, you must first download the update package onto your iPhone, you will then need to connect both devices to your local Wi-Fi network, connect the watch to its charge and make sure that its battery level is over 50%.