Review of exciting knowledge points:

1. Doing business is like sailing a ship. Entrepreneurs, as captains, should make judgments and decisions based on the data displayed on the corporate dashboard. At the same time, it is also necessary to motivate and direct the crew to work together, innovatively and efficiently.

Inspiration: The business environment is unpredictable, just like a boat sailing on rough waves, which requires a clear sense of direction and clear decision-making. Therefore, the CEO must understand the operating status of the company and be able to motivate subordinates to avoid risks and move toward goals.

2. The most common thing between Jack Welch and street vendors: he can always see the essence of business through the appearance and grasp the fundamental element of the enterprise "business wisdom". The so-called business wisdom means that entrepreneurs should focus on six key elements of business operations - cash flow income, profit (rate), turnover rate, return on assets, business growth and customers.

Inspiration: The core goal of business management is to maximize profits by creating value for customers.

Customers and markets are the direction and goal of business operations, business growth is the (strategic) course of action, and the remaining four items are various data displayed on the dashboard, reflecting the operating efficiency of vehicles and ships, that is, The difference between high-end cars and ordinary cars.

Cash flow income: refers to the difference between the total cash inflow and the total cash outflow created by the company's operating activities within a period of time. A major factor in corporate bankruptcy is the interruption of cash flow, so "cash is king" must be deeply rooted in the hearts of operators. Everyone should value cash.

Profit: Refers to net profit after tax, which is the money the company earns after paying all expenses, interest and water bills. The concepts of character's gross profit margin and profit margin have different importance in different industries. The profit margin reflects the profitability of the company.

Turnover rate: describes the length of time for goods turnover. Inventory turnover is the number of times inventory is turned over in a year. This indicator reflects the operating efficiency of an enterprise and is an easily overlooked but extremely important indicator, especially for industries with relatively low profit margins.

Return on assets: Return on assets (ROA) = profit rate * turnover rate, (R=M*V) related concepts include return on investment indicators (ROI), return on net assets (ROE) , these indicators reflect the profitability of enterprises from different angles.

Business growth: The continued growth of business sales revenue, which is determined by market size and growth. The business growth of an enterprise must be sustainable, predictable and profitable growth.

Customers: refers to the extent to which an enterprise understands customer needs, preferences, motivations, scale, segmentation, changes, etc. Only when an enterprise fully understands customer needs and trends can it make correct decisions. .

3. CEOs make money and create wealth through price-earnings multiples (PRICE-EARNINGS MULTIPLE). P-E is a ratio, which is the ratio of the price per share to the profit per share (earnings per share). Obviously, the higher the PE, the more market wealth is created. From an investor's perspective, CEOs should consider managing PE value to create more wealth for shareholders rather than simply making money.

In essence, there is no difference between a CEO and a street vendor. They both have to take into account the essential elements of business. Only by taking into account customers, growth, profits, returns, cash flow and internal collaboration and communication, will the company be successful? The road to continued growth goes further and further.