Again not a Chinese concept.

Essentially in Chinese belief, when a person of certain moral worthiness dies, in the Heavens He or She is granted the opportunity to watch over a sphere of human or natural activity. This portfolio gives them an officer position in Heaven, making them a God.

This opportunity is not granted to every soul. It is only granted to the most worthy. This is overseen by the Jade Emperor with the Dipper Mother, Queen Mother of the West etc.. who are the primordial immortals, plus also the court of other elevated mortals to Godhood and by non Gods who are humans who nonetheless dwells in the Heavens as glorious ancestors.

( The Chinese believe that while not all individuals get into Heaven … some really nasty beings get born in Hell majority gets into the ancestral Hall where they watch over their descendants. Some ancestors who are very good but not good enough to become Gods still gets to stay in the Heavens to act as workers or guards or just citizens of Heaven. When newly deceased mortals are elevated to Godhood all Heavenly beings gets say in this promotion … even non Gods ).

We just get to know that this has happened when on Earth prayers get answered and miracles happen by this individual.

It is not considered a common occurrence. Traditionally there entire clergies determining if a minor prayer answered is because a person merely got into Heaven OR is actually a God. There are many minor Gods in the Chinese pantheon where are disputes about whether they are merely Heavenly beings or Gods.

There is a popular deity in southern China who is worshipped for medical blessings who is not in fact officially considered a God but rather just a helpful Heavenly being who procures Heavenly treatment and send them to Earth!!!