This first comment I saved from a discussion on Compuserve Books and Writers Community. This was written by Beth
Start with the big stuff. Look for ways to tighten up overall story by cutting or combining scenes and cutting or combining characters. Look closely at subplots. Do they support them main plot or are they independent digressions? Also look for ways to strengthen your main character(s). How badly do they want what they want? How clear are their motives? How far did you go to thwart them? Are the stakes high enough?
Look at the plot itself: are there reversals and setbacks? Is there a moment when the protag appears to lose everything and/or when the antagonist appears to win? Is there rising tension throughout the story? Look for plot holes, continuity errors, and credibility issues.
(Don Maass's Breakout Novel Workbook would probably be helpful in this process.)
When you've addressed all the major areas, then start working through the story scene by scene, line by line, increasing tension, eliminating excess, arranging flow, adding (or reducing) underpainting, sharpening the emotional impact.
Last thing, copy edit for word choice, typos, etc.
Here are some links to a few blogs.
Hopefully someone else out there will find these useful.
I'm sure many of you have your own saved links and if you want to share any great ones on any writing subject in the comments please do.
Have a great weekend!