The location of an object in 3D space is defined by a point called its center. This location can be described in more than one way or according to more than one frame of reference. For example, the global position is expressed in relation to the scene's origin. The local position is expressed in terms of the center of the object's parent.
The center of an object is only a reference — it is not necessarily in the middle of the object because it can be relocated (as well as rotated and scaled). The position, orientation, and scaling (collectively known as the pose) of the object's center defines the frame of reference for the local poses of its own children.
However, it is generally recommended that you avoid making your objects too big, too small, or too far from the scene origin. This is because rounding errors can accumulate in mathematical calculations, resulting in imprecisions or even jittering in object positions. As a general rule of thumb, an entire character should not fit within 1 or 2 units, nor exceed 1000 units.