Something like this?

DECLARE @OutlineNumber VARCHAR(1000)

SET @OutlineNumber= '.I.A.1.b.'

SELECT STUFF(SUBSTRING(@OutlineNumber,1,CHARINDEX('.',@OutlineNumber,N+1)),1,1,'')

FROM dbo.Tally

WHERE N < LEN(@OutlineNumber)

AND SUBSTRING(@OutlineNumber,N,1) = '.'

The variable needs to have a dot at the beginning and at the then for this solution to work...