This picture is very subtle in the way that it shows us the metaphorical strings behind this Star Wars creature, but when you see it you automatically think, "so that's how they made this creature." While watching the movie you never once stop to think about how the creatures move or how big they are in reality, which is a testament to the realism of Star Wars. Now that I've seen this, all I can imagine is some guy holding this big worm and wriggling it around.
I think that there is no better way to make a sci-fi/fantasy movie than with miniatures. As good as computer effects are, they don't look as good as practical effects. A lot of the effects in Star Wars still hold up today. The only effects that don't stand the test of time are the CGI effects. That should tell you something.