You want your characters to elicit a reaction. Violence, disgust, joy, anger, they need to summon something in your guts. Perhaps they carry an identifiable trait. Perhaps they remind you of somebody, or some time, or some place.

They MUST be exceptional. Why else would we want to read about them then? They cannot just be a person in an interesting place. That is not enough to engage. It will leave the reader skipping dialog and going straight for the setting. Then they are left wondering.

Some stories can skate by on a unique setting, but the magic trick is that a unique setting just becomes the best character, so you've sort of succeeded in that case, but not well.

Take, for example, a story I wrote about a prayer-server in a world where middle management administers divine retribution to those who pray for it. The most important thing about that story was that Heaven had a backlog and was behind on its work.

The character was a nothing. He was a tour bus. Most of the interesting writing was going on elsewhere.

You need an exceptional character that can contest against an environment, exceptional or otherwise.

Let's try to flesh out this failed character.

He was an administrator. Boring. But not dead on arrival.

Perhaps he's lazy? Wrong again. The character needs agency, the same way he needs talent, ingenuity, and a world that nonetheless frustrates him.

Best bet is to give the character a series of problems that describe the world, and teach its rules, but he still overcomes them.

Our character is no longer a standard administrator. He's a specialist that has worked his way up from an administrative level. He has seen it all. He knows how to deal with the world's weirdness that others around him might even struggle with.

How did he get like this? Experience. He's sort of a detective. He notices details. This gives him motivation to describe his thinking. This way, trouble finds him, and he deals with it.

I prefer protagonists to engage with trouble instead of shrink from it. That way, a reader can wonder, "man, how is be gonna get outta this one?"

This doesn't mean the protagonist is Superman. Remember, he has a background. He has a history of capability, but also he's sometimes wrong. Or he has certain blind-spots that he can't seem to overcome. He's got strong traits and flaws.

He's like a real person, except exciting. He is an exceptional protagonist.