What it means is, if the cell referenced in a formula will never change you can hardcode the value instead of the reference !!
I think you may have that backwards. As I understand it, the "rule" is if you have a value in a formula that will or might change in the future, do not hard-code that value inside the formula... instead, put that value in a cell and replace the value in the cell with the address of the cell you put the value in. That way, when the value changes in the future, you don't have to look for the formula in order to change the value there, rather, you just have to change the value in the cell and the formula will automatically update for the change. The idea of the label is to tell yourself in the future what that number means (so you will know that it is the one that needs to change). A rough example would be a formula like this...
=8*24
where 24 is the number of employees (the formula gives the total man-hours available in a single workday. Since the number of employees may change in the future, the "rule" is to put the 24 in a cell and change the formula to reference the cell. So, let's say there is a sheet named Variables in the workbook where all the values that can vary will be placed. The suggestion is to put the 24 in a cell on the Variables sheet... let's say cell A9 (the assumption being cells A1:A8 already contain other values from formulas that were replaced with cell references according to the "rule"). So, you would put 24 in cell A9, put a description of the value(say, "Total number of employees in company") in cell B9 and change the formula to this...
=8*Variables!A9
Now, when the number of employees change in a year or two, you won't have to search the various formulas to find the number 24 that needs to be changed, rather, you simply go to the Variables sheet and search the descriptions until you find the one that says "Total number of employees in company" and change the 24 in the cell next to it.
