First, read through the whole thing just to see if it makes sense.
Make note of what areas are slow, what areas need elaborated on, retconned, etc. Start big, and look at your story arc as a whole. Fix the major plot problems. Don't make notes on individual sentences yet.Then break it down by scenes.
Not chapters (an arbitrary division that should generally come at the end of a scene), but scenes. A story is nothing more than that-- a series of interconnected scenes. And every scene you go through, ask yourself these questions:1. What is the purpose of this scene?
This is the most obvious and first question-- why did you write this scene in the first place? What does it do for the story?
2. Does it tell me more about the characters?
I personally prefer a character driven story over a plot driven, but I know tastes vary on that front. But ideally, as this a story about your characters, every scene they are in should tell us something about their personality. So does it do that?3. Does it further the plot?
Even a character driven story needs a plot. If the answer to question #2 is no, then #3 needs to be a definite yes. If #3 is also a no, then your scene is probably nothing more than exposition and should be ruthlessly eliminated or reincorporated.4. Can I do so more efficiently?
The best scenes are ones which further the plot and highlight your characters' personalities. If #2 is a yes, but #3 is a no, then your scene is likely just character fluff, and should be incorporated in a more efficient manner. Nobody's stories have got time for fluff. Tighten it up.5. What are the consequences?
Of course, it's not enough to just have a series of good scenes. They have to flow. I call this the "action-reaction" mindset. If something happens in your story and there are no consequences from it, then what was the point of it happening? One thing needs to inevitably lead to the next.And that's all there is to it. They're basic questions. There's no magic trick. Just a laying of scenes, brick by brick, to create the road which drives your story.
And these questions work for more than just scenes too-- the characters you add, dialogue, action, it all has to do something for the story, or else you're just going in circles, adding filler.
After you've looked at these (and after doing it a few hundred times it will become a natural process) then it's time to edit the nuts and bolts-- grammar and spelling, word choice, continuity, and character consistency. This is where you go after those sentences with a red pen. But huzzah! You've already broken your story down into scenes, so just go over each scene with a fine tooth comb, one at a time.
Editing is a massive undertaking that in some ways is just as difficult as writing. But you wrote the rough draft didn't you? And that was massive. So approach it the same way: one piece at a time.
A FINAL NOTE: if you're a real writing wizard, you can help ease the editing process by learning to do this as you go along with the rough draft. Now, you want to be careful to not get so bogged down in analysis that you don't write a rough draft to begin with, but I've figured out the best thing for me to do is write down, before I write a scene, what the scene needs to accomplish and a quick sketch of what happens. It makes editing so much easier, just as taking the time to type things correctly in the first place does (please do that too). As the old saying goes "an ounce of prevention is worth a pound of cure."