The term is to be used to criticize a group for its mistakes, particularly if the mistakes happened after a great deal of energy and activity, or if there was a lack of coordination among the members of the group.
There are a lot of Keystone Cops running around in this project.
Ineffective, bungling law enforcers who have nothing better to do than to stake out parties and arrest underage drinkers. This double entendre is derived from the name of the underage beer of choice: keystones
We were right in the middle of a sweet party, complete with keggers and 40s, but the Keystone Cops showed up and cleared the place out.