Unless somebody is directly involved in the federal hiring process, I'm not going to take their word how it works in practice. I'm pretty sure there are posters in this forum that can confirm or deny whether that's how it works.
This is from all the way back yesterday, but I have relevant experience to share.
I've participated in 4 hiring panels in the last 18 months, leading two of them, and being a panel member on two others. My "day job" is in project management, these are for positions in the general area that I work (aka I'm not an HR person).
In my experience (and in nearly a decade of interacting with the hiring process), the resume keyword bingo is spot on - the HR types and their computer filters work their magic and provide us a list of people that are "qualified" based on resume (and sometimes the questionnaire where everyone rates themselves to be a genius).
That's where the actual worker person work starts. Before receiving the stack of resumes that made cert, the panel leader writes a scoring rubric - what are the qualities and experience you're looking for and a grading scale. You and the panel then evaluate all the resumes and come up with a numeric score (I usually use a 1-5 with 1=something relevant; 3=direct; 5=this person wrote the book, with 2/4 available to catch some nuance). Once everyone scores, math gives us an ordered list and we decide who to interview - set the cut line based on how many interviews you want to do/have time to do, if there's an obvious knee in the curve, etc. If there's someone below the cut line that you really want to talk to, it's not impossible, but you do have to be able to explain why #7 on your list is getting an interview, but #5 and #6 aren't.
Interviews are more of the same - everyone gets the same questions, and the questions get scored by the panel.
Based on interview and resume scores, you build a ranked list of candidates and a cut line. This person is #1, this person is #2, this person is #3, and we're not interested in hiring any of the others.
Then it goes back over to HR for them to do HR things, and some time later the person we selected shows up for work.
At the end of the day, it's the outcome that matters - we want the best, most qualified person in the job and we want to ensure that everyone has a fair shot at being the selectee. Is there a process to get there? Of course. Does the process matter more than the outcome? Absofuckingloutely not. Anyone claiming so hasn't been around the parts of the process that I've experienced.
I'm sure that the specifics of this vary from agency to agency - the wife works for a more different federal agency, and their process is similar in the broad strokes and different in the implementation details.
Relevance to the current topic? I sure as shit hope that it doesn't change and turn into nepotism central down in the working ranks, and that I'm junior enough to not have to worry about getting Schedule Effed into oblivion.