when you click the button a Material Browser window will open. Double click on "Bitmap" it should be at the top of the list of options.
Now it'll open a regular windows file explorer. Open the Checkboard file from above. There is a button along the top part of the material editor that looks like a box with a checkerboard pattern on it. Click this button. This is the "Show Map in Viewport" button. If it is not highlighted, then you will not be able to preview your map in the main max windows.
Next click the other button shown in the picture above. This is the "Assign Material to Selection" button. If this button is greyed out, make sure that your head model is selected, then click the button.
Wah! It just got all crazy looking didn't it? That's because right now the UVs for the head are all screwy. they haven't been laid out properly and that's what we're going to do next.
First we're going to collapse our Modifier Stack. right click on the word "Symmetry" and choose Collapse All. Now instead of two halves, we just have one solid object.
Go into Polygon Selection Mode and select all of the neck. Make sure your selection is the same on both sides and that you aren't missing any polygons and that you don't have any extras selected that you don't want
Now click on the Modifier List drop-down menu and scroll waaay to the bottom and find UVW Map.
Under Parameters choose Cylindrical. Scroll down a little further to Alignment and choose X (or whichever one gets the cylinder to be facing up and down)
Now the real purpose of applying the Checkboard Map is to get scale fixed before we get too far. In my model (and most likely yours as well) the checkerboards currenly appear squashed. What we need to do is to get them to look as much like perfect squares as possible
In the modifier stack, expand the + in front of UVW Mapping and select the Gizmo. Now you can control the mapping cylinder. Press F4 to turn off the wireframe and you should be able to see the map as it's applied to the mesh. Now, using the scale tool scale the cylinder up or down until most of the checkers look like squares
Now right-click on UVW Mapping and choose Collapse All. We have now applied these UVs to the model. If you go back into Polygon mode, the neck polys are probably stil selected. I find it simlifies my life if I set material IDs to each section I apply a different UVWMap to, since it lets me select them much easier later on. So scroll way down in the polygon parameters to the area right above the smoothing groups area we used earlier. The section that says Polygon Properties: Material: Set ID: Set the ID to something like 10. Chances are that none of the other polys are already set to 10, so it's a good number.
Now lets select the rest of the face. A quick and easy way to do that is to go to Edit and Select Invert.
Now everything else is selected! But that means there are a few things selected that we probably don't want right now. Specifically the insides of the eye sockets and the inside of the mouth. So lets deselect those areas.