In MTW, every time you built a unit, any unit, it had a chance to have general stars. The liklihood was determined by a LOW, MEDIUM, or HIGH setting in the massive .txt file that had every unit variable in it (which is also why MTW was way easier and better to mod). So for example, spearmen had LOW but Royal Knights had HIGH.

So you could build Royal Knights and some would come out with one or two, maybe three stars.

Then there were pre-set heroes, like William Wallace, Strongbow FitzGilbert, El Cid, etc. which the game would assign to a unit, again based on their liklihood to get a general, after a certain date. So for the English, the first Royal Knight unit you build after like 1098 will be Strongbow I think, something like that. Strongbow came out with 4-6 stars. Each faction had different numbers of these historical hero units waiting to be spawned after certain dates. Also, in MTW, the characters could die, but the units retained the stats. So Strongbow would die, and random person X would take over that unit, but still have all of Strongbow's Command stars, Accumen, Dread, etc.

Then on top of all that there was a system of assigning governorship. Once you captured a province, a little icon appeared on the game map that looked like a scroll. This was the title of Lord for that region. You could also build certain buildings which created additional titles, like Constable of the Tower or Marshall of the Horse, Warden of the Clinque Ports and so on. Anyway, each of these titles conveyed stat boost to which ever unit you granted the title to. Every title granted some boost to the unit's loyalty. Some granted additional Command stars, Accumen, Dread, and Peity.

EVERY unit in the game has a Command, Accumen, Dread, Loyalty, and Piety stat. So, a common practice was to make cheap 100-man units with at least 4 Accumen the governor of a province. The lordships and other titles that granted Command start could be given to your top commanders to increase their power on the battlefield.

It was an awesome system, very flexible, very realistic too, and very simple. As a king, you could make even a peasant unit the lord or a province if you wanted (if they had high loyalty and high Accumen). Only the king and his immediate heirs could not be granted these titles. However, former heirs no longer in the line of succession could be granted titles. I really hope that system comes back.