Central to the functioning of a living cell is its ability to control the readout or expression of information encoded in the genome. In many cases, a single transcription factor protein activates or represses the expression of many genes. As the concentration of the transcription factor varies, the target genes thus undergo correlated changes, and this redundancy limits the ability of the cell to transmit information about input signals. We explore how interactions among the target genes can reduce this redundancy and optimize information transmission. Our discussion builds on recent work [Tkacik, Phys. Rev. E 80, 031920 (2009)], and there are connections to much earlier work on the role of lateral inhibition in enhancing the efficiency of information transmission in neural circuits; for simplicity we consider here the case where the interactions have a feed forward structure, with no loops. Even with this limitation, the networks that optimize information transmission have a structure reminiscent of the networks found in real biological systems.