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why do we need to convert a layer to a smart object at the beginning of every major effects process?
We do not need to, but not doing so would necessitate destructive editing (at least for Filter applications, transformations, …) and that has drawbacks.
What are you really talking about?
Edit: What exactly do you mean by »effects process«?
Could you please post screenshots with the pertinent Panels (Toolbar, Layers, Options Bar, …) visible?