Float allows the foot to change the angle it pushes or pulls from at various points around the pedal stroke. On the down stroke a straight forward foot position is natural, while pulling back a heel-in, toeing out position may feel more natural because the hamstrings are doing the work and their attachment point is toward the medial (center of the body).

Once set, cleat position should be neutral: there should be absolutely no twisting sensation through ankles, knees, or hips. To accomplish this you need to match your natural foot alignment. Some of us toe-out, toe-in, or are aligned straight forward. You can check this by watching your stride as you walk, or looking at the marks left in firm sand during a run. Some coaches suggest you jump and see how your feet are positioned upon landing. All these methods should give a similar result.

There are five dimensions to consider when setting cleat position: height, cant, front-to-back, side-to-side, and rotation.

Cleat height modification is to compensate for a leg length difference. It's more important for the run than bike, but can still be helpful if your difference is 1cm or more. A flat shim under the cleat works for most pedal systems and I go with one 1/2 the actual leg length difference. A thick shim changes the dynamic of your pedaling as your foot gets further from the pedal spindle. With a thin shim you should notice no difference.

Canting is tipping your foot to the inside or outside with a shim shaped like a wedge, usually tipping toward the lateral (outside). I am not a fan of this except for athletes with a significant bow-legged alignment who also need compensation in running shoes.

For front to back adjustment the ball of your foot should be directly over the pedal spindle. Typically this area runs diagonally from medial (inside) to lateral (outside) so choose the spot under third metatarsal for your reference point. Get the cleat on one shoe set correctly, then match it with the other shoe.

Next you need to choose the best spot on the pedal laterally (side-to-side). Too close and your ankle will hit the crank arm; too far away and it will be awkward, like walking with feet spread far apart. Athletes who toe out significantly will need feet further away from cranks for heel clearance. If you have big feet frame clearance at the cahainstays could be an issue. Once you have these first two positions set you can leave the bolts firm enough so the cleat can't move freely, but loose enough so you can still twist it with significant pressure.

Setting the rotational position is where you get that neutral feel in sync with your natural toe-in or toe-out tendency. This is the most important setting to keep your knees happy as you pedal. I've known quite a few athletes who toe-in with one foot and toe-out with the other. There's nothing wrong with this and you need to go with it when setting cleat position. If you cleat/pedal system has float all you need to set is the rotational range then let your lower legs find their own natural angle(s) on the pedals.

Arch support, canting, and height can also be altered with orthotics for cycling shoes. If you feel you have a problem you can try this but be careful. I've seen orthotics created with no compensation for the original shape of the cycling shoe. Running shoe orthotics are designed to seat on a flat surface (where you've taken out the original insole), but I've never seen a cycling shoe with a flat surface inside the shoe. Put an orthotic on top of this already contoured surface and you have a foot with double the intended cant toward the outside and major problems follow. Run shoe orthotics won't work in cycling shoes.