I've been high on Smart all season long, and I'm disappointed in the ignorant bashing that's been directed at him in comments and forum posts here on celticsblog. Let's break it down and start with D, as his D is what sets him apart from the pack.
Smart is a defensive superstar, the best defensive guard I've ever seen at the college level.
First, his tools. He has good size (6'4) and great length (6'9) for a PG. He is very strong, and on his undersized team he frequently battled forwards in the post, with success. He has very good if not exceptional lateral quickness and explosiveness. All in all, excellent tools. He will be able to comfortably match up against most NBA wing players.
More importantly, his defensive skills. He plays with incredible intensity and precision. On the ball, he has perfect footwork, draping himself on his man, reacting just the right amount to every movement his man makes, never getting juked or blown by. He anticipates his opponent's move and beats him to the spot, drawing lots of charges and breaking down plays. He picks pockets without gambling, and uses his super-quick hands to intercept his own man's passes. It appears that he has an uncommonly good reaction time. In the post against taller players, he is a warrior, and he denies deep positioning. While he can't block a 6'8 forward's shot, he excels at keeping his man from literally seeing the rim by keeping both arms straight up. He uses his body to keep his man off balance, showing an incredible knack for playing physical, aggressive defense without getting whistled. You often see opponents get owned by Smart, shoot an airball, and look pleadingly at the ref like "what am I supposed to do against this guy?" Easy: just don't try to score on him.
His defensive impact is not limited to shutting down one man, however. Off the ball he is a great help defender due to his anticipation and sense of positioning; he is always in the right place in the right time, and then he closes out really well, bothering the shot without allowing penetration. He is an opportunistic playmaker, constantly hawking the ball, with outstanding anticipation in the passing lanes. His 3.3 steals per 40 was epic already, but it likely would've been even better if he could have been full-time on the perimeter; instead, he was often guarding forwards and battling for post position (due to his undersized teammates).
Smart's offense is a mixed bag. He has major strengths and weaknesses, but fortunately his weaknesses are addressable. I'll break it down into weaknesses and strengths (this wouldn't make sense for his defense, as he has no weaknesses on that end!).
Smart shot a bit under 30% from 3 last season. It sounds like the C's really think he is better than that figure would suggest, and it wouldn't surprise me. Some of his shooting issues seem very correctable. First, he dips the ball below his waist before shooting, which hurts both his consistency and his release quickness. Second, he seems to jump too high, causing balance issues; it isn't a dunk, Marcus, it's a jump shot! I suspect that he's never had a decent shooting coach in his life, as I don't think highly of Travis Ford and the Oklahoma State coaching staff (more on that later). He shot a high volume of 3pt shots off the dribble, which dragged down his 3pt%; I imagine that he could've improved his 3pt percentage dramatically if he didn't take so many ill-advised shots. This brings me to his largest offensive weakness:Shot selection
Like many other top prospects (Jabari Parker and Aaron Gordon in particular), Smart doesn't always make the right play. This is slightly more worrisome for a PG, as he will be making a lot of decisions on the court. I place part of the blame on Ford, a decidedly bad coach. I never saw him tell off Smart for taking contested jumpers early in the shot clock. If Smart continues his chucking ways without making a genuine improvement in shooting ability, he will be a negative on offense. Fortunately, his issue seems to be tied to coaching and to his role on the team as "the man," and not to selfishness; by all accounts, he is an incredibly unselfish player and person, and he accrued a nice assist rate. I'm very confident that Smart will improve his shot selection under Brad Stevens.
Smart's handle is not great, and he doesn't play with a lot of shake. He sometimes gets out of control, and he has an above average turnover rate. It isn't a glaring issue like Wiggins' handle is, however, and it clearly does not prevent him from getting to the rim at a high rate. If he can develop an array of iso moves, he would be a mismatch for most defenders; he would post up quick guards and blow by stronger wings. However, I think it is more likely that he will be more of a straight-line driver, which will keep him from attaining superstardom on the offensive end.
Smart is undeservedly criticized for his passing ability. In fact, he excels at passing off the drive to the paint. He either anticipates the help and quickly threads the needle before the defense expects it, or he elevates as if for the floater before dropping off a pass instead. He seems to be better at hitting a nearby teammate for the layup or short jumper than at hitting the 3 point shooter. He also has a great bounce pass, which he uses to split defenders on the pick and roll and the double team, and to hit teammates in front of him in transition. He doesn't seem to be awesome at making perimeter passes to his teammate's shot pocket, but there's no reason to think that he won't develop this skill. In short, he has excellent instincts and feel, and I think that his playmaking and passing will develop into a major strength under Rondo's tutelage.
Getting into the Paint
despite his limited repertoire of dribble moves, Smart gets to the paint using his strength and athleticism. He puts his head down, clears out with the off hand, and bowls into the paint with abandon. Once he has a step on his defender, it is extremely difficult to recover as he uses his strength to get his shoulder between the defender and the hoop. One way that he gets the step is by coming off a screen and receiving a pass.
Drawing fouls and finishing: Once he gets to the paint, Smart is very hard to stop. He goes right at the help defender and initiates contact, often finishing through it using his strength. He shot 73% from the line last year, down from 77% as a freshman.
Smart uses his strength to exploit mismatches in the post. He was used in the post with unusual frequency for a PG, and this was despite the fact that he was rarely guarded by point guards; opposing teams noticed that he was built like a linebacker, and usually put their best defensive wing on him. They weren't really punished for this because he was never the smallest guy on the floor for his team. In the NBA he will match up against more point guards, so if anything I expect to see him increase his post production. He won't have a mismatch every night, but he will force opponents to make adjustments for him due to his post-up game.
All in all, Smart is a fascinating, promising, and unconventional offensive prospect. He has multiple paths to offensive success in the NBA. The one thing he absolutely must improve is his shot selection. He could develop his handle and cut down his turnover rate to excel as a pure PG; this is his best bet, since he will be a mismatch for many opposing PG's. Alternatively he could develop his shooting and become more of a SG in Dwayne Wade's mold. Either way I'd expect him to play both positions at times, and to defend both positions regularly.
As much as I love Smart's game, I love his personality and character even better. He draws unusually effusive praise from those around him for his leadership, competitiveness, and surprising modesty. This is a young team, and I think we've been lacking locker room leadership since Pierce and Garnett departed; Smart will fill that void.
Smart is not merely a string of positive adjectives, intense, selfless, modest, hardworking, etc. He has rare depth of character, and to appreciate it you have to look at where he comes from. I won't tell his life story here, but suffice it to say that he had a lot to overcome. Most guys facing what Smart faced at such a young age are changed for the worse, but Marcus is an inspiring example of someone who made a conscious choice to remake himself into a better man. I highly recommend reading this article from Grantland about his youth (thanks to Celtics39 for posting it in a forum thread).
Even if Smart is a total bust in the NBA, I'll be proud to root for him and and for his team, the Celtics.