I show the algorithm below. It is helpful in some ways. However, it need not give the "simplest" expression; here we could also write
$$ (x+y+2z)^2 - (y+z)^2 - y^2 = x^2 - y^2 + 3 z^2 + 2 yz + 4 zx + 2xy $$
The method used to go in this direction is usually called repeated "completing the square," and hardly requires matrices to do by hand.
$$ Q^T D Q = H $$
$$\left(
\begin{array}{rrr}
1 & 0 & 0 \\
1 & 1 & 1 \\
2 & 1 & 1 \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & - 1 & 0 \\
0 & 0 & - 1 \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & 1 & 2 \\
0 & 1 & 1 \\
0 & 1 & 0 \\
\end{array}
\right)
= \left(
\begin{array}{rrr}
1 & 1 & 2 \\
1 & - 1 & 1 \\
2 & 1 & 3 \\
\end{array}
\right)
$$
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
As there are just three elementary matrices $E_j,$ we end up with
$$ P = E_1 E_2 E_3 $$
and
$$ P^{-1} = Q = E_3^{-1} E_2^{-1} E_1^{-1} $$
Algorithm discussed at http://math.stackexchange.com/questions/1388421/reference-for-linear-algebra-books-that-teach-reverse-hermite-method-for-symmetr
$$ H = \left(
\begin{array}{rrr}
1 & 1 & 2 \\
1 & - 1 & 1 \\
2 & 1 & 3 \\
\end{array}
\right)
$$
$$ D_0 = H $$
$$ E_j^T D_{j-1} E_j = D_j $$
$$ P_{j-1} E_j = P_j $$
$$ E_j^{-1} Q_{j-1} = Q_j $$
$$ P_j Q_j = Q_j P_j = I $$
$$ P_j^T H P_j = D_j $$
$$ Q_j^T D_j Q_j = H $$
$$ H = \left(
\begin{array}{rrr}
1 & 1 & 2 \\
1 & - 1 & 1 \\
2 & 1 & 3 \\
\end{array}
\right)
$$
==============================================
$$ E_{1} = \left(
\begin{array}{rrr}
1 & - 1 & 0 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
$$
$$ P_{1} = \left(
\begin{array}{rrr}
1 & - 1 & 0 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; Q_{1} = \left(
\begin{array}{rrr}
1 & 1 & 0 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; D_{1} = \left(
\begin{array}{rrr}
1 & 0 & 2 \\
0 & - 2 & - 1 \\
2 & - 1 & 3 \\
\end{array}
\right)
$$
==============================================
$$ E_{2} = \left(
\begin{array}{rrr}
1 & 0 & - 2 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
$$
$$ P_{2} = \left(
\begin{array}{rrr}
1 & - 1 & - 2 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; Q_{2} = \left(
\begin{array}{rrr}
1 & 1 & 2 \\
0 & 1 & 0 \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; D_{2} = \left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & - 2 & - 1 \\
0 & - 1 & - 1 \\
\end{array}
\right)
$$
==============================================
$$ E_{3} = \left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & 1 & - \frac{ 1 }{ 2 } \\
0 & 0 & 1 \\
\end{array}
\right)
$$
$$ P_{3} = \left(
\begin{array}{rrr}
1 & - 1 & - \frac{ 3 }{ 2 } \\
0 & 1 & - \frac{ 1 }{ 2 } \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; Q_{3} = \left(
\begin{array}{rrr}
1 & 1 & 2 \\
0 & 1 & \frac{ 1 }{ 2 } \\
0 & 0 & 1 \\
\end{array}
\right)
, \; \; \; D_{3} = \left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & - 2 & 0 \\
0 & 0 & - \frac{ 1 }{ 2 } \\
\end{array}
\right)
$$
==============================================
$$ P^T H P = D $$
$$\left(
\begin{array}{rrr}
1 & 0 & 0 \\
- 1 & 1 & 0 \\
- \frac{ 3 }{ 2 } & - \frac{ 1 }{ 2 } & 1 \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & 1 & 2 \\
1 & - 1 & 1 \\
2 & 1 & 3 \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & - 1 & - \frac{ 3 }{ 2 } \\
0 & 1 & - \frac{ 1 }{ 2 } \\
0 & 0 & 1 \\
\end{array}
\right)
= \left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & - 2 & 0 \\
0 & 0 & - \frac{ 1 }{ 2 } \\
\end{array}
\right)
$$
$$ Q^T D Q = H $$
$$\left(
\begin{array}{rrr}
1 & 0 & 0 \\
1 & 1 & 0 \\
2 & \frac{ 1 }{ 2 } & 1 \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & 0 & 0 \\
0 & - 2 & 0 \\
0 & 0 & - \frac{ 1 }{ 2 } \\
\end{array}
\right)
\left(
\begin{array}{rrr}
1 & 1 & 2 \\
0 & 1 & \frac{ 1 }{ 2 } \\
0 & 0 & 1 \\
\end{array}
\right)
= \left(
\begin{array}{rrr}
1 & 1 & 2 \\
1 & - 1 & 1 \\
2 & 1 & 3 \\
\end{array}
\right)
$$
..............