Here is the suggested sight alignment [relationship of front sight to rear sight] and sight picture [sight alignment in relation to the target] as printed in the Winchester manual which came with a M94.
Attachment 318799
First thing to note is the size of the bullseye (black part) of the target is large enough to give a definite place to aim.
Next note the how the bead sits in the notch with equal "light' around the notch between the notch and the bead front sight. The relationship between the bead and the rear sight notch is called "sight alignment". It must remain the same throughout the shooting process and the eye should focus on the front sight keeping it as clear ass possible. It is ok if the bullseye [I prefer to use an 8 - 12" bullseye] is slightly blurred as you can still aim at the same spot on the "blur" for each shot. If the front sight is blurred and the target focused clear then the groups/accuracy will be poor. Focus on the front sight.
I like to zero my M94 sights so the center of the group/cone of fire is 2 to 2 1/2" above the point of aim at 100 yards. Also, when zeroing from the bench I prefer to hold the M94 with both elbows resting on the bench. I hold the fore end as when shooting it and rest the back of the fore end hand solidly on a firm sandbag. Using good breathing and trigger control I can shoot 2 - 3" five shot groups with my full bore 178 gr 311041HP hunting loads. Remember, focus on the front sight and use a large enough aiming point.