One of the byproducts of the transition from having Kevin Rudd as PM to Julia Gillard has been a bunch of people who think we live in America complaining that the whole process was undemocratic and not what they voted for. They say that they voted for Kevin Rudd as Prime Minister, and not Julia Gillard.
On this they are wrong. None of the voted for Kevin Rudd to be Prime Minister. Most of them didn't vote for Kevin Rudd for anything (I happen to be registered in his electorate, but he didn't get my first preference (I think he would have been around second or third depending on what other parties were running)). They voted for a member to represent their electorate.
They should take a closer look at the Australian constitution. And then they could tell me which part of it says we get to vote for a Prime Minister. In fact, if they can find anything about there being a Prime Minister I'll be surprised.
Back when they were setting up the federal government in the late 19th century, and they cribbed a lot of stuff of the British, including the concept of the Prime Minister, who was basically the member of parliament who had the most support from the other members of parliament. If the PM loses the support of parliament, he loses the job.
And that's what happened here. By losing the support of his party, Kevin Rudd effectively lost the support of parliament as a whole. And while technically he did not have to stand down as soon as it was apparent he had lost that support, by doing so he avoided a lot of messy parliamentary procedure that would have had the same end result.
This is all a well accepted part of the Westminster system. The government we have today is the same government we had before and is the one we elected. While you can definitely question the motivation of the Labor party (the support of the party has gone to the person they think will give them the best chance of being reelected, which is not necessarily the same thing as who will be the best leader of the country) in making this change, what they have done is in no one unprecedented, or even unexpected. Keating did the same thing to Hawke, and Costello should have done it to Howard.
So, in conclusion, let us welcome our new red-headed PM, and hope she does right by the country, even if she has missed an early opportunity to get rid of Senator Stephen "Internet Filter" Conroy.