Hello Ricky,
Update Manager works on 5 thumb Rules.
1- Create A Baseline ( Baseline is collection of your patches, Extenstions, Upgrades or any bug fixes). Two types ( Static and Dynamic ( Static does not get updated automatically if any patch of the similar type is added to the repository where in dynamic baseline gets automatically updated if any patch of the similar type is added to the repository.
2- Attach the baseline- So in your case once you have created the baseline based on the patches that u want for your esxi host its time to attach this baseline to your esxi host (Yes it can be attached to a single ESXI host also to the entire cluster.
3- Scan for compliance- Scan to check whether your esxi host is compliant or non compliant based on the baseline which is attached to it. If it is compliant you are all good but if it;s not compliant you need to proceed further.
4- Staging- This is process in which you download the actual patch it does not require any downtime for your esxi host, as it will downloading the patch to your repository because initially only information about the patch is downloaded.
5- Remediation- This is the last stage which is actually patching your Esxi host ( Based on the patches you have added to your baseline your esxi may or may not reboot..
Rgds
Kanishk