I'll be the first to admit I don't have a wide range of experience in Jira, so there may be a better way to do this, and I know there are plugins/Service Desk has some of this built-in, but what I have done in the past is:
- create a status called Pending Approval with a transition called Get Approval which brings up a screen
- When you trigger the transition, you could either just make use an assignment field to assign the issue directly to the approver, or have a custom field called Approver so that you can keep track of who the approver was without digging through history. The issue would then get assigned to the approver as part of the transition.
- Now the issue is assigned to the approver and I find it helpful to have two transitions from the Pending Approval status--Approved and Denied which I have setting a custom field called ApprovalStatus to the appropriate value. I prefer this to setting the value with a dropdown and then transitioning because it is a bit more user friendly to have an Approved button and a Denied button and it makes it easy to have separate workflows for approved and denied issues. You probably want to have a transition screen with a comment field though so the approver can comment.
- You would then cause the previous transition to move to the next status in the workflow and assign the issue back to the appropriate person. This may mean you will need fields to track who the developer is, etc.
Anyway, like I said, there may be a better way to do this, but it works for me. To answer your questions:
Who approves it? Whoever you specify in the custom Approver field--you could even have the person specified when you first create the issue.
How does the approver get notified? When they get assigned the issue, they should get an email unless you monkey with you notifications.
Where does the issue live until approval? Wherever your other issues live--it will just have a different status. Based on the assignee, status, etc., it may show up on a dashboard, filter, board, etc. It's up to you. You could have a column on your board specifically for issues pending approval.
I should also mention that you could do something similar but instead of using the workflow of the current issue, your transition could spawn a new issue that links back to that one. I don't think it is realistic though without post functions from JSU or JMWE.
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