So in case you haven't already noticed, I'm doing a very quick, very brief overview of the main points of story creation. Once I've hit most, if not all, of the highs, I'll then proceed to give more in-depth analysis according to my own experience. Please to do not take anything I say as "law", I'm still learning myself. I can, however, present the theories that I have established in my years as an undergrad and graduate student in accordance to what does and doesn't work.
And now, Character.
After World Building, the characters you create are the most important part of the story. You could have the world's most generic and over-used plot, but with good, strong, and engaging characters almost no one will notice, and those that do won't care. The best way to accomplish this is to create characters that people can relate to while still keeping them unique. So how do you start? With the obvious.
The first thing anyone notices about another human being is how they look. Are they tall? Short? Skinny? Fat? What color is their hair? How old are they? Do they have any wrinkles or scars or distinguishing birthmarks? What sort of expressions do they wear? Are they constantly smiling or are they more reserved? How do they generally dress? And, of course, the obvious and mundane questions of what's their hair/eye/skin color, etc.
Once you've settled on an outer appearance for your character, you need to look under the skin. For an example, I'll bring back Miss Susie since we're already at least partially acquainted with her. So here is how her physical profile would look:
Name: Susanna "Susie" Salino
Hair: Light brown originally but dyed blonde
Distinguishing marks: a small mole on the corner of her left eye
So now we know what she looks like, but what is she actually like? Well, let's say that she's a sad, angry person but keeps her emotions bottled up behind false smiles and well-practiced seduction. She dresses provocatively and often acts less intelligent than she actually is. She has the ability to inspire loyalty but has a hard time trusting the people she works with and she never tells her full plans to any one person so they can't use it against her. She's shrewd and calculating and more than willing to step over people to get what she wants, even if those people she steps over are supposed to be her friends. Her whole life revolves around getting her man and nothing, and noone, else matters.
But why is she like that? Was she always like that? What happened in her past that changed her? Here is where things get interesting.
An important part of World Building is creating a world complex enough that "real" people can live in it. Susie can't be vindictive just because she was born that way, something had to happen to make her that way. A naturally bad person just isn't interesting or relatable.
So let's stick to the general idea we've already created for Susie. We'll say that during WWI, her then-boyfriend, Patrick Salino, was in the trenches and that, during a particularly intense battle, he lost his leg and was sent home. Despite his handicap, Susie still loved him and agreed to marry him. Money was tight because of her husband's disability, but he managed to find a job selling tickets at the local movie house. After three years of marriage, they have a daughter named Victoria, but she's born sickly and, in order to afford her medical care, Susie has to get a job as well. She strikes a deal with James "the Smokes" Dennison and becomes a card sharp employed by one of his illegal casinos in Brooklyn.
For a while, things work out perfectly, but then Victoria takes a turn for the worst, and her only hope is an expensive and experimental surgery. Feeling like she has no choice, Susie takes more than her allotted cut from the casino - promising herself she would return it with interest - and intends to use it for her daughter's surgery. James learns what Susie did and sends his men to her house to demand she return the money. Susie asks for more time, but they decline and get violent. Patrick tries to step in but he's shot in the confusion, and the men leave, taking the money with them. Without the money, Victoria dies, and now Susie is left without a husband or a daughter, and she blames James for her loss.
So now we have a heart-wrenching back story that gives us a reason for why Susie is targeting James Dennison. The greatest part of the Character Creation process is that, by giving life and motivation to the main character, we're already halfway through planning the Plot.