If you want to create a full body morph then ensure that the required figure is selected in the scene. It will not matter which particular part is selected just ensure that the right figure name is visible top left of the preview window. Then go to Figure > Create Full Body Morph.

If you wish to create a morph on a single body part or prop ensure that it is the selected actor in the scene. You'll see it noted as the second name top left of the preview window. Then go to Object > Spawn Morph Target.

Hope that clarifies.