I believe The Banner Saga is a good reference for what we are trying to do: a simple isometric combat system with a few stats.
The battlefields in the game are compacted and battles involve around 12 units, 6 for each team. Positioning is important, knowing how to use your units to block enemies, reduce their shield and strength with adjacency and using renown is what makes this game interesting. We are not huge fans of the combat system for an issue that I describe more in depth later: the health system encourages the player to not kill enemies in a weird way.
Some units occupy for tiles rather than one. This leaves them exposed from being attacked from the double amount of units at once, two from both sides.
Whenever you attack a unit (shield or strength) any adjacent enemy unit also receives 1 damage of the same type. This feels very satisfying as it plays with positioning: you can bundle your units together to make the enemy pile towards you and then punish them
The Banner Saga doesn't have "health" or "Attack Power". Instead it has strength, represented by the red bar above each character: this acts as both the health and the attack power, so the unit gets weaker as it loses health.
This system, compared with the fact that there is no "initiative" in the game but player and enemy units will take alternative turns regardless, creates an unintuitive pattern of play where the best strategy is not to kill enemies when you have the opportunity but to bring their strength down and then leave them be, so that they won't deal any damage at all and therefore will not be a threat, but they will still take their turn and allow the player units to, practically, play more often.
Units take their turns in alternation: first a player unit, then an enemy unit. This changes when there is only one unit
In this instance for example it would be reasonable to finish off the characters right adjacent to the active unit (The big boi in the blue robes): these are all very low health and could be finished in one hit, leaving space for the group to move to the unit with 9 remaining strength.
But this would mean that exactly that unit would get more turns and therefore deal more damage that the other three dying units combined, so the best strategy is to circle around them and focus on the healthy unit first. This feels contrived.
At the end of each fight the player can choose to leave and be satisfied or "hold on for longer". If the player takes this choice new and stronger enemies will spawn, combat will continue.
