This may be a simple question but I am having difficulty figuring out how to measure runout/alignment for bellhousing. I have seen a number of pictures and posts of the dial indicator attached to the flywheel, plunger to inside diameter of bell opening.

My question is where/how to locate the dial indicator base.
Doesn't it need to be centered on flywheel PERFECTLY to measure runout?
How would you do that??

I have a feeling this is much simpler than I have made it.

Please help.