Novelists work on two levels at once. They must not only invent the story they will tell, but also decide how this story should be told. (In distinguishing between these two levels, the literary theorist Boris Tomashevsky named them “fabula” (the events of the story as they putatively occurred) and “sjuzet” (the events of the story as they are presented to the reader)). It is the existence of this second level, the sjuzet, that distinguishes the novel from other literary forms.
In analyzing the sjuzet, you should first see where and how it differs from the fabula. The literary theorist Gerard Genette has identified three ways in which it may do so. First, in the order of events. In the fabula, as in life, events unfold in strict chronological order, but they can be entirely reordered in the sjuzet. The narration may go back in time (what Genette called an “analepsis”) or forward in time (a “prolepsis”). Second, in the duration of events. An event may be narrated in the sjuzet in roughly the same amount of time that it would have taken to unfold in the fabula (a “scene”), but it may also be narrated more quickly (a “summary”) or more slowly (a “pause”); it may also not be narrated at all (an “ellipsis”). And third, in the frequency of events. An event may take place one time in the fabula and be narrated one time in the sjuzet, but it may also happen many times and be narrated only once or, alternately, happen one time and be narrated again and again. Once you get a sense of the novel's normal strategies of order, duration, and frequency, you'll be able to notice the always significant moments when the novel departs from its own norms.
In analyzing the sjuzet, you should also attend to the narration. Here, too, Genette provides useful categories. He distinguishes between "homodiegetic" narration, in which the narrator is a character in the story that he or she is telling, and "heterodiegetic" narration, in which the narrator is absent from the story he or she is telling. About homodiegetic narrators, you should ask the following two questions: is the narrator central or peripheral to the plot? and is the narrating self identical with or somehow different from the self being narrated? With heterodiegetic narrators, you should first consider them as characters in their own right: some will be barely sketched, but otherwise will be quite fully drawn. Look for moments when narrators refer to themselves, whether to their own experiences or to the very act of writing the novel. Look, too, for moments when narrators seek to interpret or account for events by placing them in some kind of context: religious, moral, historical, scientific, philosophical, or the context of common knowledge or proverbial wisdom.
Homodiegetic narrators can see and narrate only as much as the character’s position in the plot allows. Heterodiegetic narrators, by contrast, can potentially see and narrate everything that is going on, although novelists often decide to limit their perspective in some way. Such limitation is what Genette calls “focalization.” A narration can be focalized through a single character (stable focalization) or it can shift among characters (variable focalization). In much the same way, homodiegetic narrators can only know what they themselves are thinking—although they don’t always confess to all of it at the time!—while heterodiegetic narrators can potentially know what all the characters are thinking, or only some, or none at all. Pay particular attention to moments when the focalization shifts or moments when the narration suddenly gains or loses access to a character's thoughts.
You should analyze the fabula as well. The components of the fabula (characters, events, details) all work together to create an illusion of reality, an illusion that nineteenth-century novels are particularly committed to creating. But these components are also elements of the novel's composition, part of its formal patternings, and you should attend to these patternings as you analyze. This means that you should never consider characters in isolation, but always in relation to one another. Some characters will form pairs, for instance, while others will form groups, and you should identify the traits that define these pairs and groupings: family, location, profession, values, and class, among others. The plot, too, should not be considered in isolation. Look, instead, for the repetitions and variations that structure the events of a particular plot; for the relation between the novel's several plots, if it has more than one; and for the uses that are made in this novel of a plot form (the courtship plot, the quest plot, the Bildungsroman) that appears in many different novels. Note, too, how the plot is shaped by the novel's division into chapters, into volumes, and into serially-published parts.
Detail should also be analyzed. You should get a sense of the kinds of details that go into creating a given novelistic world: what does the novelist choose to include and exclude? Does this novel focus on particular kinds of character to the exclusion of others (women? workers? the poor? slaves?)? Does it focus on a particular period of life (is this a novel of childhood, of youth, of middle-age?)? On particular domains of experience (social ritual? bodily sensation? aesthetic experience? religious or intellectual life?)? On a particular location (the city? a small town? nature?)? You should also distinguish the details that are significant in themselves from those that contribute the novel's illusion of reality. Once you identify the significant details, look for the kinds of patterns they create--and see whether these patterns amplify or undermine the novel's themes.
Finally, you should remember that the novel is an unusually capacious genre, capable of containing all other linguistic discourses. It is for this reason that M. M. Bakhtin famously called the novel "heteroglossic" (many-tongued). In addition to the discourse of the narrator, the novel presents the discourse of characters, but it can also present poems, songs, newspaper articles, scientific reports, medical treatises, bureaucratic forms--in short, any kind of linguistic text. In presenting these alternate discourses, the novel implicitly establishes some kind of relation between itself and these possible rivals. Gauge what this relation is.
M. M. Bakhtin, "Discourse in the Novel" (1934-5) (reprinted in The Dialogic Imagination: Four Essays, ed. Michael Holquist)
Gerard Genette, Narrative Discourse: An Essay in Method (1972)
Boris Tomashevsky, “Thematics” (1925) (reprinted in Russian Formalist Criticism: Four Essays, eds. Lee T. Lemon and Marion J. Reis)