There's not any one way to make a system, there are just ways that you shouldn't. This topic has been discussed to death, I literally have something I can copy paste here for it, which includes something that I had written even earlier and copy-pasted into that.
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Firstly, avoid too many numbers. A lot of the issues people have with systems comes from the meaningless lists of numbers. Number goes up, quite frankly does nothing substantial, and after a while just feels dry, something to skim over. Levels and stats are meaningless. At least, if you overuse them. Don't use levels and stats as the means by which your character gets stronger. Grinding gets boring, slow growth of skills and stats has no observable benefit to the story than if you just, didn't show the numbers but let your character develop their potency through less heavy-handed means. If you're going to use numbered stats and skills, make sure that the it's the number that reflects the character's growing competency that you show in story, rather than the number going up that artificially inflates the character's ability. Skill levels are useful to track a character's level of mastery, but don't get caught up in like, skills that grant number bonuses to stats, increasing the bonus as you level the skill, that's meaningless. Skill levels should provide a point of comparison that allows a reader to intuitively understand how skilled the character is relative to other characters. If the average level of Sword Mastery among knights is 5, and the MC has the skill at level 7, that tells us where to expect our MC to stack up against them, in that category at least. But if that's all your system does, it's not worth it.
Personally, I prefer a more, milestone and special-power based system. Where levels serve as, essentially, progress bars to the next milestone, which either unlocks new abilities, or expands old ones, letting them be applied in new ways, and stats just serve as the prerequisite to being able to face tough enemies, but not the source of the characters power. That kind of progression is far more interesting than just, 'Iz slightly better at swinging sword, now' 'Has 50 strength now!', etc. The abilities this kind of system grants need to be something more than what can just be acquired without a system, or simple magic. If all the system is gonna do is track how well someone can swing a sword or throw a fireball, it's just telling instead of showing, it serves no purpose, find a better way. A system needs to serve as a way to make something that wouldn't be possible otherwise for your story/characters, possible. And, abilities granted by the system should be personalized by who your characters are and the actions they've taken, what they've gone through, challenges they've overcome. If your powers are too generic, if everyone has the same or similar abilities, they start to lose their significance.
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An important thing to consider when discussing Systems is where did it come from? What are it's limits? Is it a fundamental law of the universe, or was it created by someone? For what purpose? This can drastically change things, because if it's fundamental, then it might not be exploitable and there might be no theoretical limit to anyone's growth, but if it was made by someone, depending on who and why, it could have faults that could be exploited, inherent imbalances, limits. The System could be neutral, an ally, or an enemy, depending on why it was made. It could be omnipotent and omniscient, or it can be constrained.
And whenever you write a story with a system, you should first ask yourself if you can tell the story you want to tell without it. If the answer is yes, then you shouldn't bother with a system, it'll just bog things down with meaningless numbers that don't actually mean anything. If a story has a system, it has to be somehow relevant to the plot or essential to the world, either by allowing things that otherwise wouldn't be possible for the characters/world, by acting as a pseudo character in and of itself, by shaping civilizations in the world, or something else.
It's also notable that not every system has to have numbers, or even progression. A system could be as small as everyone gets one skill at adulthood, for example. There's no progression, but it could still have large implications in world building, with inherent inequalities based on what kind of skill you have, class systems based around that. Having a single skill might make characters need to be more creative about it. And it can serve a roll to give characters unique powers that would otherwise be difficult to fit into a setting or explain just how they work, or would be too difficult in practice for a person to actually use without 'system assistance'.
Personally, I prefer systems that are light on the numbers and numbers of skills, and focus more on the unique powers afforded by the skills, beyond a the simplistic stuff like 'oh, increase fire damage by 1% for each level in this skill'. That type of skill is just not narratively interesting, and it's hard to see the effects in the story. It might as well not be there.
Skills should have direct, visible effects in the story, and advancing the skill should have tangible, immediately obvious benefits. That is much more satisfying for a reader than just, 'number go up'. Eventually, number go up becomes boring and just gets glazed over. Skills having levels is okay, but I believe they should not be the sole thing going on. I believe that levels should act more as progress bars to the next milestone, which fundamentally alters or expands the skill in some way.
Skills are more crucial to a system than stats. It's the skills that make or break a system, by both meanings of the word. Read enough LitRPGs and stats start to lose all meaning.
If you do decide to use stats in a system, you should make it very clear in-story, through action, the impact those stats have. For a stat going up to have meaning, you have to very firmly and intentionally demonstrate time and time again how those stats make what would otherwise be impossible, possible.
You should be very aware of what kind of power scaling you intend for your system as well, and where that power comes from. Is it the skills that propel people into the superhuman, or the stats? How superhuman can people become with the system? Capable of wrestling a mammoth? Capable of punching a planet into oblivion? The larger the scale, the more careful you have to be with big numbers, because eventually every big number looks the same. You might want to be more reserved with increasing numbers, but make each one count more. Or, you could have different 'stages', and when you advance from one to the next, your stat display shrinks down, not actually decreasing the output but simply putting the display into perspective for the stage of power you're on.
I still personally don't think stat numbers is very good, personally, and you shouldn't just replace it with a different-looking but identical in practice system either (like letter grading). It's not the inching forward growth that's satisfying, but the milestones (at least in my opinion, but I don't think it's an uncommon one?), so a system that capitalizes more in milestones will be more satisfying.
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It's been some time though so my opinions might have changed a little bit since then, but I'm pretty sure I still agree with the gist of it. A couple of side notes.
Using a system, not as a means of growth but just as a way to communicate powers that the user obtained manually, or possibly make it easier for them to repeat things they've already done, is another way to go about it. That's one of the cases where it's more a crutch for the writer, especially if you want to give the protagonist some starter-ability but don't want the trouble of having to show how they got it, or learned they had it and what it can do: if you want to get straight into the story. It's certainly not the ideal way to go about it, but it's not completely unforgivable either if you're careful.
Another is, please choose your stats with care if you're going to use them. Make them make sense, make sure their intuitive and don't overlap too much, and for god's sake DON'T mistake dexterity for agility or conflate the two! And if you're going to have stats for magic, just one 'Magic' stat is utter bullshit, magic should honestly have roughly the same number of stats as your physical body (a magic defense stat may be unnecessary).
This is my stat array, it's very expansive and some things might be simpler to cut out, but I believe it's the most honest representation how a person's stats should be, and anything less loses very important nuance. In an actual story you might cut out some just to make it more digestible. I already simplified it a bit by making mental stats also the ones that effect magic, because if I didn't then there would be A LOT of stats, rather than just, a lot.
Strength - physical power (note, archers often get classed as dex, but actually also need significant strength to pull back heavy bows. An archer will want more strength than a swordsman)
Agility - physical speed (note, a warrior would want both strength and speed, hell, probably highly skewed towards speed. Don't forget, a major component of kinetic energy is velocity, aka speed in a direction. Also, speed to react to opponents attacks, evade, and exploit openings. All too often I see the importance of agility under-stated)
Dexterity - physical coordination/precision (good for craftsmen, and anyone with high agility in order to control said agility. Dancers, musicians. Warriors for footwork and weapon control. Archers too for steady hands.)
Endurance - physical stamina (fighting in melee, especially with armor, or traveling long distances, takes a lot of stamina)
Resilience - physical resistance (to damage)
Vitality - rate of healing (could also encompass health total, and maybe even stamina regen, depends on how you handle those or if those stat pools even exist)
Willpower - force of mind/magic (used in contests of will, breaking illusions, powering through pain and trauma (note, doesn't deal with the trauma, just allows action despite trauma), also effects the power of magic, or rather, how much power you can get out of every unit of mana)
Intelligence - speed of mind/magic (actually increasing the intellect of a character is just... not something that is practical for a writer, but speed of thought works well. This effects how fast someone can react to a situation and how fast one can put together their magic. Low-key one of the most underrated stats for warriors because they need to react to what their opponent is doing and choose the correct counter)
Focus - resistance to distraction, ability to keep calm, and fine magic control (good for craftsman and those casting big spells that require concentration to put together. Archers too, because they need focus to make sure they are shooting exactly the right way to be consistent, and thus precise)
Wisdom - memory and size (and regen rate) of mana pool
Perception - perception (rather self explanatory)
The exact names, especially of the mana/mind stats, can vary a bit. Honestly I'm not completely satisfied with the way the mixing of mental and magic stats went, relative to their physical counterparts, but it's decent enough.