ArcGIS Model Builder - Select by Location: Using an Output as an Input

While building a model in ArcGIS Model Builder today I was baffled by the fact that I could not use a previous output as the input for the Select by Location tool. I later realized that I must use the Make Feature Layer tool on the output before it can be used as the input for Select by Location. Make Feature Layer creates a layer from a spatial dataset so that it may be used with any tool requiring a feature layer (such as Select by Location).