Investor-to-investment steps at a small startup RIA

Can someone please help me map out the steps / various players involved in a typical private investor-to-investment transaction at a small startup RIA firm? Please comment on my understanding below, especially on step 3, 4 and 5:

1. Investment Advisor (IA) brings in a client (BD, accounts transfer, custodian relationship etc.)
2. IA prepares an IPS
3. IA does asset allocation based on client’s risk tolerance and return requirement
4. IA typically has particular investment beliefs, philosophies, styles, etc., for various asset classes and based on that he selects appropriate Asset Managers (AMs) to invest client’s assets
5. AM diversifies funds allocated to her and buys/sells based on the recommendations from her in-house team of research analysts (RAs)
6. IA monitors and reviews AM’s performance and hires/fires them as necessary
7. IA does rebalancing as needed

Also, 1) does a typical small RIA outsource step 3 and 4 above to a PM and be just a relationship manager? 2) assuming the strategy is 80/20 Core/Satellite, does a typical small RIA outsource step 4 above just for the Satellite potion of the portfolio? 3) who typically ensures proper diversification; IA or AM?

Any help in crystallizing this will be much appreciated.