The aim of this article is to explore the principles of design and innovation, to explain the need of design integration into organization structure and its impact on the economy. Design is not only a beautiful shape, it has a much broader meaning and it covers many different areas, which are not related to design of its classic interpretation, such as engineering and medicine or business. Kyoto Design Declaration states that the design addresses the problem by granting functionality and meaning, creates concepts. The design also has a social accountability component, which is closely related to the values of society. Design contributes to building of a sustainable, people-centred creative society (Kyoto Design Declaration, 2008). Today design is an integral part of the organization, the foundation stone for the success of its existence. The article discusses the principles of design and innovation, describes its role in the business environment and successful organization of business. This theme is current because Latvian Design Council has operated since relatively recent and many company representatives still underestimate the importance of design; as well as many future designers have no understanding of the extent of their opportunities in the business world and what contribution they could make by providing services to entrepreneurs. The article analyses Latvian cosmetics companies, which integrate design in their activities, as well as provides insight into how to increase the design growth in the business environment at the national level, based on British experience. It requires cooperation among all its elements to make innovation system effective. There is a need to increase the use of potential of the creative industry and added value for products and technologies and creation of unique niche products.