Too often, I see an improv scene in which two people are looking out into the audience, past the fourth wall, at something which is going on outside of the view of the audience and outside the control of the performers.
Maybe it's a grizzly bear running at them full stride (but never making it there). Maybe it's a building on fire (but not to be put out). Whatever it is, it isn't happening on stage, which means the performers cannot act on it, which means they are mere observers in the action.
This of course means that the audience is watching someone... watch something. This is far from a transformational, engaging scene. There are no stakes. No consequences of the characters' actions or for their lives.
To help us imagine what is going wrong here, and to try to make the scene more true, engaging, and transformational, let's imagine rings of significance emanating outward from each character.
If I told you right now that a Chinese businessman in Shenzhen lost the keys to his car, what would you do or say? Probably not much. What could you do? If, on the other hand, I told you that the love of your life was making out with another person across the room, what would you do? Probably cry. (At least, that's what I would do.)
The point is that the Chinese businessman's car keys hold no significance for you, while your emotions for the love of your life do. In the first scenario, nothing is at stake for you (or even very much for him, really). In the second, everything is at stake: the rest of your life with this person who you thought completed you.
So, let's draw out these rings of significance, to help visualize. Of course, this is an abstraction, but it can be a useful tool in understanding and calibrating decisions we make in a scene (or perhaps in day-to-day life).
The first ring is internal to the character. This is their innermost hopes, desires, insecurities. It's their emotional center and true identity.
The second circle is their physical well-being. It's their ego, which is constructed within the context of a group or society -- it's the "role" they play in their life.
The third ring may represent a group identity (am I a Cubs fan or Sox fan? am I pro-choice? am I violently opposed to plastic straws? did Fred really not care that I have an Eames chair?).
The fourth ring is further removed from the character's emotional center and identifying factors. It is something which seems to have no direct bearing on their life, but is incidental and occurring in the environment, be it cultural or physical (a crow cawed in the tree, the sun just came out from behind the clouds, China pulled out of the trade deal, etc.)
In the opening example, of two performers looking out at a bear or a burning house, the ring of significance is probably around Ring #4. The environmental element exists and is noticed by the character, but it bears no direct relation on the understanding of who they are as a character. This doesn't mean that it can't however. If a bear is running at you, you might being thinking very hard about what kind of life you've led. Even in the mundane example above of the sun emerging from the clouds, if you witness that at just the right point in time it might trigger an epiphany that changes your life.
What we're really interested in is the intersection of these rings of significance. Just because the house is burning down off stage, it doesn't mean that it can't affect a character on an innermost ring. What if it's their house? And what if the other character started the fire? Then we have stakes, and we have an opportunity for transformation. Then we immediately bring the rings back to center on the characters, and specifically on the characters' centers.