Sorry, I don't know how. Supposedly, the dead hairs are pulled out, but hair above the root is dead anyway. It seems to me that a good daily brushing to remove the hairs that are about to fall out could achieve the same objective.
My understanding is that hand stripping is done for certain terriers--like Airedales--and other wire haired breeds, that the dogs don't really need it for their health and well being, and that it's done for the sake of appearance in show dogs.
A real dog expert could give you a much better answer.