Most think the Heroes are a little underwhelming right now and I tend to agree(unless you use exploits with rings and amulets). Just to be clear this is mainly referring to combat heroes, not management heroes.
Here's some ideas on how the Heroes can be made a little bit more useful.
The heroes usually come badly equipped and are unrealistically less powerful then some the monsters sometimes. If the hero could survive in the wilds, surely that hero would have gained more then a club or found some armor. Yes you can research adventurer techs that spawn more powerful heroes but here's where I see a problem with them, the monsters almost always out level them.
After you buy your hero, you have to spend X amount of gold to make that hero effective. Why not just have the hero come with equipment and add that to the cost of recruitment for the player? This in turn makes heroes more powerful and more expensive. It also allows the hero to cope with the roaming monsters and bandits better rather then never attacking them. I read or heard somewhere that the NPCs that don't belong to nations have their own agendas so it would be nice if the world was populated by more heroes but are more expensive, which gives me the player a choice in what hero I want to recruit instead of just recruiting all I see or that wander into my turf. Also if heroes have their own agenda then logically they would be attracted to places that have plenty of monsters or plenty of items for them to buy.
To cope with the added cost of recruiting a hero full time, maybe a system of renting a hero for X amount of turns. In other words the hero has a fee you pay for services. This would simulate "questing" for heroes since they are under your service temporarily, and of course heroes will have their buyout fee. This might be tough cause their inventory would need to be locked out to avoid abuse however you still need to get the quest items from them. Maybe a system of when the hero leaves your services, you have the option of paying the hero in full or allowing the hero to keep whatever item they aquired as a reward, maybe use the trade system of value that the player uses when dealing with other nations. Maybe a reputation with heroes so they are cheaper next time you hire them and lowing the buyout price on them. This could also be a tech added in and not something the player can do right away.
Instead of techs leveling up heroes and monsters individually. Combine the 2 techs so the heroes are on par with the monsters and have a hero tech tree that effectively lowers the cost on recruiting heroes or allows more options with heroes. Maybe something like what Sins did with Pirates, you can get a tech that allows you to put bounties on certain monsters or even nations. Techs that allow heroes sharing their maps with you (buying maps from individual heroes) or techs that all you to purchase wares from wandering heroes/merchants. Maybe even some espionage options like paying heroes for information about certain rivals like army strength/techs that sorta thing, even going as far showing cities they previously visited (showing the buildings and armies there) for 1 turn (obviously you can get a list to choose the info you want to purchase).
Heroes need to group up in parties more. Now I know we don't want this super NPC unit or stack running around the game but it would stop the monster problem if heroes just stuck together more. There should be an option to recruit individual heroes from the party (instead of the whole party), again give me the choice of which hero in the party do I want to hire since I can only afford 1.
Heroes and monsters should heal themselves better, they keep moving around which makes them not heal.
Heroes should also randomly put up quest items they found in a global auction house where nations can bid on them (perhaps a random event).
Non-combat centric heroes need a way to develop, either through spending Gildar for education or by getting XP from buildings in city.
EX: Heroes with Merchant abilities get 1xp from money buildings, Scholar heroes get 1 xp from schools/libraries
Doing this gives cities even more personality cause you send all the scholars to the academy/university city and it educates them, making it a well known college town or merchant city if dealing with merchants.
More non-combat items for non-combat heroes. Like say spectacles that give a +10% XP bonus, this stacked with the previous suggestion would mean that non-combat items are spent to level up the hero even quicker in towns.
Heroes should have morality or preferences(based on race or relationships), a good hero should cost more to recruit or is impossible to recruit(maybe a tech to make it recruitable, like corruption) for a Empire. This would make it so some heroes you want to see killed so the enemy doesn't recruit them when they can afford them, maybe even putting out a hit on that hero for other heroes as per suggested above.
Heroes should vary their recruitment cost based on actions in the world.
Example: The hero is of the race of men. The player has been at war with Men and conquering all those cties, so that hero cost more to recruit or flat out refuses to deal with you (like nations do in the bargain screen).
Heroes should spawn from towns/settlements as well the wilds. These heroes would be of the race of the town and might be cheaper to recruit for that nation but are still NPCs.
Ability to create my own heroes (starting at lvl1) from scratch like the sovereigns after certain techs, maybe even techs relating to hero creation (IE they start out higher level or unlocking more classes/abilities). The balance here is that the hero doesn't come as high level as a NPC hero and doesn't have any equipment, forcing the player to spend gildar equipping them (sorta the system we have now).
Hopefully these are things to keep in mind when the expansions come out.