Wikipedia
Hand-for-hand situations in the card game of poker arise exclusively during tournaments at times in which multiple tables are in play and the tournament is nearing an increase in the prize payouts, and/or there must be a definitive player ranking.
In poker tournaments, the order of elimination is the means of determining player rank. Because rank directly amounts to a particular payout, at times during a tournament play is slowed down to ensure accurate measurement of player elimination. Hand-for-hand play requires all hands be dealt at the same time. When a table has finished a hand, the dealer must wait until all tables have finished to commence the next hand. This does not affect how a particular table 'plays' their hands; only the deals must be simultaneous.
Another reason for the use of hand-for-hand play is to prevent players from stalling, or deliberately taking as long as possible to act on their hand in the hope of moving up in the prize structure when players at other tables bust out. By ensuring that each table plays the same number of hands, the incentive to stall is removed.
Hand-for-hand play usually starts when the next player (or players) to leave the tournament will be the last place at a given payout. Most poker tournaments, for simplicity, group payouts based upon rank below the final table. Twentieth to eighteenth may be paid the same amount, and seventeenth through fourteenth may be paid a higher amount, for example. In this scenario, hand-for-hand may commence with 21 and 18 players remaining. At the 2005 World Series of Poker Main Event, day 4 started in hand-for-hand, with eliminations required until 561 players remained.
Hand-for-hand play eliminates ties, except for one exceptionally rare situation. If multiple players go all-in during one hand run hand-for-hand, assuming all players all-in are eliminated, the players are ranked according to chip count, the amount the player had in front of them at the beginning of the hand. Players are only awarded a tied rank if they have identical pre-hand chip counts, in which case the prizes are customarily split by both players. In some situations, pre-hand chip counts may not be available, in which case, all players eliminated on a given hand are considered to have tied for the same rank. For example, at the 2004 World Series of Poker Main Event, where 225 players were scheduled to be in-the-money, hand-for-hand play was held with 226 players. David Combs and Dewey Tomko were eliminated on the same hand, and were considered tied for 225th; they initially split the $10,000 prize before the casino elected to give them each $10,000.
In the 2006 World Series of Poker, round-for-round play was used instead of hand-for-hand. Here, a round is defined as the blinds going around the table once. Therefore, at a nine handed table one round would consist of nine hands. The difference from hand-for-hand play is that in round-for-round play, each table finishes one round of play (instead of one hand), then waits for all other tables to finish the current round. The advantage of round-for-round is that it does not slow play down as much as hand-for-hand, and is much easier to coordinate in a live tournament setting with a large number of tables still in play, while still eliminating any incentive for players to stall.