I first survey the scene before me to determine the light values and decide which slice of the scene before me I wish to capture. I do all of my Panos, hand-held, which isn't the best. Really you should use a levelled tripod otherwise you cannot be sure you take every shot on the same horizontal plane. Once I determine what I wish to photograph I point my camera at what will be the middle image in my perceived scene and I notice what settings the camera has chosen. I also make a mental note of where my centre focus point is. I gently "click" the shutter and wait a moment for the camera to go back to ready mode. While all this is happening I make sure that I do not move my camera from its position as I have to rotate the camera on its nodal point, which is the mid-point distance from the sensor to the end of the lens. Do not assume that the tripod socket is the nodal point, as it is not.
With the camera in exactly the same position as was used to take the first photo I gently press the shutter button half way to lock focus and exposure. I make sure that the centre focus point is on top of what it was on the first photo and look at the settings the camera has chosen, and it should be the same as was used on the first photo. With the shutter button still half depressed, I now rotate the camera to take photo two. It doesn't matter whether you take the left one or the right one but rotate the camera on it's nodal point making sure to keep the same horizontal plane and allow at least 25% overlap. Remember not to move the camera from its original position.
When the camera is ready, focus again as you took the first photo and rotate to take the third one. It is easier to do this than it is to explain it. You can probably take all three photos in this sequence in about 5 seconds. Of course you are not limited to only 3 photos, you can use many more For stitching panoramic images I use a FREE program called Autostitch.
Here is a link to where you can download it
http://cvlab.epfl.ch/~brown/autostitch/autostitch.html
After you start the program go first to Edit, Options and you will get a screen like this

Don't change too many numbers but pay attention to those two boxes numbered 1 and 2. This is where you can control how large your resultant jpeg is. You can take a small megapixel camera and cumulate the pixels added by each image and end up with a very large file. For best printing results stick with 300 dpi
Note: make sure all your images are in the same directory, preferably consecutively numbered and hold Shift/click to select all the ones in the sequence. The program then starts processing without warning, all done automatically before your eyes
Here is the image which was produced by my Lumix ZS3 using my work-around technique comprised of 7 separate 10 MP images

(Lumix ZS3 stitched from 7 images using Autostitch)
for the full sized version from Photobucket, click here <------- * * Make sure to click "+" to go to full size
Now go and try it for yourself