controllable-inputs-framework

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