So this is my human friendly (therefore, fool-proof) guideline to going from writing your first draft to having a polished manuscript. This is the most simplified version. A straight line. In reality, the road to getting to that polished manuscript will be very tangled and go in every which direction, but this is very basic, for our purposes. Just be wary that most paths generally look like this, but yours might not.
This is also the path I most recommend, after having attempted to skip some steps or do them out of order or run off my road altogether. Stick with this. It won't let you down.
the first draft
Get it down. Write it as quickly as possible. Whether or not you outline beforehand, just sprint through your first draft and try to make the best of it. Don't look back. Don't give up. Don't make edits or changes along the way. If you get another idea, write it down and save it in some brainstorming folder. If you make a change, write it down for when you get to revisions so you can go back and make necessary changes.
Bottom line: Finish.
Before you start this, I would recommend making some kind of outline of what you've got at this point. Make a list of your characters. Of your plots and subplots. Determine what you need to expand upon and what you need to trim. Make any of those changes that you meant to (but didn't!!!) while you were writing the first draft.
Be harsh with yourself. Merge characters. Rearrange scenes to make certain plots/subplots stand out/fall back. Be sure that there is a clear division between the three thirds (beginning, middle, and end) of the novel. Tear your first draft to shreds.
What you should care about: Structure, Plot, and Characterization.
what you shouldn't care so much about: Style, Details
Send to beta readers! They are lovely people who will read your manuscript for you and tell you what works and what doesn't. Generally, they volunteer for the task, and perhaps in the future you will return the favor for them. You can find betas at various mixers or on Twitter.
How many betas? I'd recommend over 5. And all that should matter at this point is overall, big concepts, like the plot and characters and world-building. You do not need line edits at this point.
Don't skip this step. I learned this the hard way.
Bottom line: Send to several betas for general suggestions on major story components
Simple. Make revisions one what they said. And be harsh. If more than 1 beta mentioned it, it's a problem. If all of them mentioned it, you bet that you better change it. If only 1 mentioned it, that doesn't mean it doesn't matter, but you should decide what exactly the problem is and whether or not you feel it needs to be addressed.
Be harsh. It's going to hurt. No one ever told you it wouldn't. But your story will be better for it. I promise.
What you should care about: Addressing all the suggestions, glancing at any stylistic problems
If you feel you covered all of the suggestions and if you don't think you should do another round of betas to address the changes you've made, you can go to critique partners! Personally, I don't think you need more than 2 critique partners to go through your manuscript for line edits. First off, it's a lot of work for them. Secondly, you don't need 10 people telling you to change a sentence cause it sounds funny.
It is not the job of your critique partners to tell you basic things. It is YOUR responsibility to educate yourself on grammar, punctuation (yes, especially regarding dialogue), technique, etc. There are a many great resources available for you to learn these things, like books, articles, and various magazines. Just as important, studying the writing of authors that you admire and deciding what it is about their style that you love.
Time to make all the smaller changes your CPs suggested to you. It's also time to go through your manuscript yourself as harshly as possible. Fix the paragraphs that leg. Change that typo in page 127. Change the MC's sister's name to something that doesn't being with G, like three other characters' names do.
By now, your structural and huge problems have been addressed, so what you should be paying attention to is smaller details, from individual scenes to word choice.
And when you finish these (it may take several read-throughs) your manuscript should be polished and good to go!
- - - - -
There is the simplified version of how to go from first draft to polished manuscript. These are the most basic of steps, and I really recommend (from experience) not skipping any. For instance, I skipped beta readers and major revisions for my manuscript before I queried it. Yeah, I'd had critique partners read it chapter-by-chapter, but it's hard to get a good essence of the overall story when you're focused on just editing chapter 14. This came to bite me in the butt when I got several R&Rs that completely came out of left field. But I learned my lesson. After revising it for them, I sent it to a ton of beta readers to look over before I queried again.
A word of advice: If you're revising/editing your manuscript while querying it, you shouldn't have queried it in the first place.
You could just end up getting rejected from an agent off of changes that you will make later. Hold off querying until you've completed all these steps and are completely confident in your manuscript. You shouldn't have a reason to open your manuscript again until you are ready to work on it once more, either for an R&R or for the lovely agent with whom you've signed.