controllable-inputs-framework skill

---
name: Controllable Inputs Framework
description: Focus on Input Metrics (selection, price, speed) rather than Output Metrics (revenue, stock price). Inputs are controllable and causal; outputs are lagging. Amazon's flywheel philosophy.
---

# The Controllable Inputs Framework

> "If we served customers well... things like sales, revenue... and share price... would follow. We took it as an article of faith." — Bill Carr

## What It Is

A management focus on **"Input Metrics"** (controllable activities like selection, price, speed) rather than **"Output Metrics"** (lagging indicators like revenue, stock price), often conceptualized as a Flywheel.

## When To Use

- When defining **OKRs**
- Conducting **weekly business reviews (WBR)**
- When **growth stalls** and you need to diagnose
- Avoiding **short-term reactive** decision making

## Inputs vs. Outputs

```
┌─────────────────────────────────────────────────────┐
│  OUTPUT METRICS (Lagging)                           │
│  ❌ Revenue                                         │
│  ❌ Stock price                                     │
│  ❌ Active users                                    │
│  → Results of past actions                          │
│  → Not directly controllable                        │
├─────────────────────────────────────────────────────┤
│  INPUT METRICS (Leading)                            │
│  ✅ Selection (# of products)                       │
│  ✅ Price (% below competition)                     │
│  ✅ Speed (delivery time)                           │
│  → Actions you take today                           │
│  → Directly controllable                            │
└─────────────────────────────────────────────────────┘
```

## The Amazon Flywheel

```
                    ┌─────────────────┐
                    │  Better Customer│
                    │   Experience    │
                    └────────┬────────┘
                             ↓
┌─────────────────┐    ┌─────────────────┐
│  Lower Prices   │←───│  More Traffic   │
└────────┬────────┘    └─────────────────┘
         ↓                     ↑
┌─────────────────┐    ┌─────────────────┐
│  Lower Cost     │    │  More Sellers   │
│  Structure      │───→│  More Selection │
└─────────────────┘    └─────────────────┘
```

## How To Apply

```
STEP 1: Identify Your Flywheel
└── What inputs drive customer experience?
└── How do they compound?

STEP 2: Define Input Metrics
└── Each must be controllable
└── Each must have causal link to outputs

STEP 3: Measure Continuously
└── Weekly Business Reviews (WBRs)
└── Real-time dashboards

STEP 4: Resist Output Obsession
└── When output dips, diagnose inputs
└── Don't panic-optimize the output directly
```

## Common Mistakes

❌ Confusing **outputs** (active users, revenue) with **inputs**

❌ Creating "compound metrics" that **obscure root cause**

❌ Reacting to **output dips** with short-term hacks

## Real-World Example

Amazon focused on "Selection" (number of detail pages) and "Lower Prices" as inputs, believing they would drive the output of "Free Cash Flow" via the Flywheel effect.

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*Source: Bill Carr, Co-author of "Working Backwards", Lenny's Podcast*