1. How does it work?

Instead of writing a word/pdf/... document where the dev team describes what placeholder have to be replaced, the dev team provides a PACIFy configuration marker file:

deployment-package-app-v1.0
   |- config
   |   |- log4j.xml
   |   |- ...
   |- datasource
   |   |- config.xml
   |   |- ...
   |- web
   |   |- infopage.html 
   |   |- ...
   |- app-CMFile.pacify        <-- Configuration Marker File

which contains the information and is part of your package. This marker file looks like:

<Pacify>
    <Property Name="log.level">
        <File RelativePath="config/log4j.xml"/>
    </Property>
    <Property Name="jdbc.url" >
        <File RelativePath="datasource/config.xml"/>
        <File RelativePath="web/infopage.html"/>
    </Property>
</Pacify>

You don't have to specify all configuration elements in one marker file. You can create as many marker files as you want on any location within the package.

For the ops team it's now really easy to configure that package for a specific environment. They provide the values for the environment and call PACIFy via:

pacify replace --packagePath=/share/app/deployment-package-app-v1.0 ...=prod.properties

After that call, the package under /share/app/deployment-package-app-v1.0 is now configured for production.