To create creatures that are frightening and original developers begin by looking at what impact that creature has on the narrative and where it occurs within the game.
They have to make psychological considerations as well as aesthetic considerations about how we're going to use the monster, where we're going to use the monster, and where they appear within the progress of the game.
In Silent Hill: Homecoming there is a creature called Schism, whose head is reminiscent of an axe. That is actually designed to represent the differences between how Alex feels about what's happening to him and what's actually happening to him. It's kind of like a split personality. There's a clear reference to that in the creature design.