Bringing ideas to market: now more than ever, companies must focus on innovation. In this interview, accenture chairman and CEO Joe W. Forehand explains why. (Q & A).

Q.

Innovation is always important in business, but haven't a lot of companies been putting it on the back burner over the past year in order to focus on retrenching and belt-tightening?

A.

Without question, responding to the recent economic challenges has been on the minds of senior executives. And a lot of that response has focused on getting back to business basics and running the business more efficiently. Yet, as companies manage through these difficult times, it's equally important for executives to stay focused on the future and on new sources of growth. I know from my personal conversations with executives that this question of how to drive growth through innovation is right at the top of the CEO agenda.

Q.

What makes innovation so powerful?

A.

Innovation is all about being proactive. It's about anticipating change in a rapidly changing world and developing ideas and solutions ahead of the competition.

Companies can use innovation to capture market share or expand their businesses in new directions. In fact, down markets offer a great opportunity for leading companies to innovate and break away from the competition. Companies can also apply innovation to improve internal processes, so they can operate with more speed and agility.

There's no question that innovation helps a company significantly add to the value it creates for customers and shareholders. Good ideas are at a premium, and the ability to harness innovation from those ideas will lead to better and faster business results in a fiercely competitive environment.

Q.

You often talk about "innovation delivered." What do you mean by that, and why is that important?

A.

The way I see it, "innovation delivered" means translating good ideas into results that improve business performance. Making big ideas happen is one of the biggest challenges for executives today. I spend a great deal of my time meeting with business and government leaders around the world, and many of them are frustrated by how their organizations' best ideas often go unrealized. Not surprisingly, our market research supports this perspective. In recent interviews with senior executives, an overwhelming majority felt they often lacked the ability to shape and execute their ideas to deliver sustainable competitive advantage.

I believe the future belongs to companies that create and deliver on big ideas to transform their businesses, whether it's a new approach in an industry, a groundbreaking outsourcing opportunity or a solution driven by the latest Internet-based application. In other words, winning companies will focus their energy on bringing their best ideas to life.

Q.

Historically, efforts to boost innovation have often provided more in the way of platitudes and slogans than actual results. What can executives do to make innovation real in their companies?

A.

First and foremost, invest in your people. People are your innovation engine -- they connect a company to its customers and the marketplace.

To make innovation real, companies need to foster what I call "corporate entrepreneurship." This comes by encouraging collaboration. Good ideas can come from anywhere in an organization, and turning them into results typically involves many people from different parts of an organization.

I'd also suggest that companies need to balance operational efficiency with innovative thinking. They need to support their people with the funding, tools and freedom to pursue good ideas. Think of setbacks as investments in the future. Clearly, executives always need to manage risks -- and they need to be right a lot more than they are wrong -- but the most innovative ones learn to trust the idea of "intelligent failure."

Q.

In your business, innovation is your stock-in-trade. How have you put these ideas about innovation to work internally?

A.

You re right, our business is about collaborating with our clients to deliver great ideas -- both theirs and ours. So clearly, we have to pay close attention to our own ability to be innovative. We have 75,000 employees around the world, and we are working hard to ensure that our culture is truly entrepreneurial.

First, we focus on leadership development, with the belief that inspirational leaders can actively coach their teams to think and act like entrepreneurs. Good leaders can articulate the passion and vision of a corporation and build teams that perform at levels well above their individual abilities.

Second, we encourage entrepreneurial thinking in all our people. We recently doubled the size of our partnership, which I believe extends decision-making authority to more of our people and rewards bold and innovative thinking earlier in a person's career. We also have dedicated centers of innovation, like the Accenture Technology Labs and the Accenture Institute for Strategic Change, which conduct original research into business issues.

Third, we work hard at being what I call "big and small'' by balancing resource- and knowledge-sharing across the global organization with the market responsiveness and agility of a small company.

So, when it comes to driving innovation from within, we will continue to move to a more entrepreneurial culture. And we are committed to providing our people with what they have identified as important: inspiring leadership, interesting work, a diverse work force, competitive rewards, flexibility and new opportunities for continuous learning.

Q.

What is the most important lesson you have learned about building innovation into your company?

A.

I would have to go back to my point about collaboration. Innovation is really a group effort. Time and again, in our own organization and in our client work, we see the best ideas coming from teamwork. I am a huge believer in the power of teams and drawing on the talents and ideas of many. And I have emphasized with our people the importance of getting our clients' ideas into the heart of our own company as a way to complement the skills we bring. By collaborating with our clients, we learn from them and we are better positioned to help make their ideas happen.

Our best work at Accenture is done in teams, and this collaborative spirit makes our jobs more enjoyable and rewarding.

Q.

Building an entrepreneurial company clearly requires flexibility and the ability to embrace change. What does it require in terms of leadership?

A.

In my view, successful leaders in innovative and entrepreneurial companies must be excellent team-builders. They have to communicate relentlessly with their people, and they have to be as good at listening as they are at directing. Good leaders have incredible energy about building new products, services and businesses, and creating or improving processes. And they have to give credit to others and make heroes out of them. Entrepreneurial behavior is something that can, with time, be driven deep into a culture.

But the real secret is that leadership is about continually raising the bar. Yes, it's important to take the time to celebrate success -- and, as I said, to make heroes out of your best people -- but leaders can't be too satisfied with the status quo. That can lead to complacency and arrogance. The real test of leadership in an entrepreneurial company is motivating people to look for new opportunities, inspiring them to deliver innovation and results.