The novel is changing. James Wood, not so much.

Our own Morgan Meis in The Smart Set:

How Fiction Works isn't actually about how fiction works. To be obsessed with the mechanics of words and sentences, to see literature as essentially an enclosed system with internal rules, is to be a formalist, and James Wood, for all his formality, isn't a formalist. He admits as much. In the Preface to How Fiction Works Wood writes, "when I talk about free indirect style I am really talking about point of view, and when I am talking about point of view I am really talking about character, and when I am talking about character I am really talking about the real, which is at the bottom of my inquiries." For James Wood, fiction is about the world, not about itself.

Wood calls his book How Fiction Works for two reasons. The first is that he's a cocky son-of-a-bitch at the top of his game and he's ready to make serious claims. He is in full confidence and he should be. Nobody else is writing about literature with anything like his pop and verve. The second reason is that he's really using the word "works" in a secondary sense of the term. He isn't using the word in the sense of "operates" or "functions." He isn't meaningfully interested in technique. Instead, he's using "works" in the sense of: "Darling, that dress really works on you," or, "I wouldn't know what to do with that chair but it really works on this veranda." "Works" here means something more like "comes together" or "does what it is generally meant to do." The biggest clue — other than what Wood actually says in the book — that this is what he means by "works" is the title on the front cover. It isn't How Fiction Works, but How Fiction Works. Already right there, in that emphasis, Wood is telling us that he's after something bigger than mere technique. He is out for metaphysics, for an argument about the nature of reality and what it means to be a human "self." That's what Wood really cares about, and it just so happens that literature is in a special place to deliver the goods. Literature, to put it bluntly, has a special relationship to truth.

More here.