Harbaugh is probably right in that Kaepernick will be the better QB but the way he's making the transition is bad. Here's what I would have done if I was Harbaugh:
I'd let Smith continue to start, however, the moment he struggles in a game, that is, the moment he throws a few picks or turns the ball over and the Niners are losing, or in a bad situation, then I bring in Kaepernick.
With Kaepernick's performance against the bears, this would be completely justifyable. Smith would be benched simply due to his performance (or lack of performance).