Heat-shrinkable means just that, heat them up and they shrink, or more correctly, they recover in length.  A heat-shrinkable sleeve starts out with a thick extruded poly olefin sheet (polyethylene or polypropylene) that is formulated to be cross-linkable.  After extruding the thick sheet, it is taken to the "beam" where it is passed under a unit that subjects the sheet to electron irradiation.  The irradiation process cross-links the polyolefin.  This improves the molecular structure such that the polyolefin will work as part of a heat-shrinkable sleeve and provide the required level of mechanical protection while in-service.  It makes the polyolefin perform more like a tough, heat-resistant, elastic material or rubber, rather than like a plastic material.
After cross-linking, the sheet is stretched by feeding it into a machine that heats it up, stretches it and cools it down. Because the sheet has been cross-linked, after stretching, it will want to recover to its original length when re-heated.
In recent years, many manufacturers had already developed their technologies of extruding and expansion of polyolefin backing. In the past, the production process of backing was done by extruding, cross-linking and expansion. However, in order to increase the production efficiency, some of manufacturers expand the backing during extruding, and then send the backing to e-beam for the cross-linking process.