To me, it means don't aim for the green, aim for a point on the green, which of course may not be the flagstick at all.
In putting, don't aim for the cup, but aim for a point on the cup. This means always! Even if your ball is two feet from the hole.
The ultimate target in golf is the cup, but the cup is 4.25" in diameter. The ball on the other hand is about 1.68" in diameter, and on a green, rolls on its perimeter that is less than a half inch wide.
Two points about putting.
1. Effectively for putting purposes the golf ball is not 1.680 inches wide, but about a third of that. Which means that we need to think of the ball as an object a half inch wide and not three times that. To focus on the ball as a narrow hoop and not a round ball. If one side of the ball passes over the edge of the hole, the ball will not drop. The upright rolling hoop of the golf ball needs to pass over the lip of the hole. It is helpful to aim the center of the golf ball at the target, and not the golf ball as a whole. Think of the ball as a half-inch ball and not one nearly two inches wide.
2. Similarly, the hole ("cup") is 4.25" wide. That is way too wide a target. Pick a point on hole liner or edge as an aiming point instead, unless you are a long way off. Even if your ball is far from the hole, it is good to imagine your vision zooming in so that you see an aiming point smaller than the hole.
"Take dead aim."
When practicing putting, either on carpet or a green, throw down a coin and aim at that. Try to get the ball to roll over the coin and stop.