The best way I can explain it to you is to imagine a precision circle at your target you are shooting at. The better the precision a club has the smaller the circle. So if 2 dots is a 20 foot circle each significant dot tightens the circle. No, the top precision will not put it right on the target .
Forgiveness shifts the precision circle left or right (and usually short) depending on how much you mishit and what the forgiveness rating of the club is. Clubs with lesser forgiveness ratings shift the circle left/right more on mishits.
This is why (especially on low precision clubs) you can mishit slightly right of the mark and have the ball go left instead. Mishitting right shifts the circle to the right, but part of the circle is still "leftover" on the left side of the flag, so it has the potential to land there.
BTW my measurements are not accurate but were used to explain how this works.
If you use the search there have been some great graphics that explains this.