Increasing VM hard disk capacity

Hello

I use ESX 4.0 with vSphere 4.0.

When there won't be any snapshots anymore I'd like to increase VM's hard disk capacity in Edit Settings/Hard disk menu. There is MS Windows Srv 2008 R2 64-bit installed.

Is it the right way to do this? Won't operating system have any problems with this increased disk? Will main partition automatically be increased also or do I have to do it myself later?