To model means to give shape or form to something. According to a dictionary definition, modeling is "the technique of rendering the illusion of volume on a two-dimensional surface by shading."
Assuming you have this in mind, you can see some exquisite shading in the painting done by Michelangelo, especially on the blue skirt, or cloth this person is wearing. In order to create something more vivid and life-like, Michelangelo applied this technique to most of his paintings, and it is obvious in this one as well.
