Purpose: The purpose of this study is to determine how design should be managed to develop truly innovative products and services. Three management levers were examined: design leadership, design inclusion and design thinking. Design/methodology/approach: The study was carried out as a survey of innovation managers in the USA. The survey measures were developed from the design and innovation literature. Over 300 managers participated in the survey, and their responses were analyzed by using multiple regressions and other statistical tools. Findings: All three aspects of design that were studied – leadership, team inclusion and thinking – were found to significantly and positively impact new product and service innovativeness. Of these factors, the most important contributor to innovativeness was design thinking, with having more than three times the impact of the other two. Also, firms that are large, publicly held and technology-intensive are on average more innovative. Practical implications: To increase the innovativeness – or novelty, interest in and influential – of new products and services, managers should appoint designers as leaders on innovation project, include designers in development teams and above all integrate the design thinking process in organizations. Originality/value: This study determines that design leadership, inclusion and thinking increases the innovativeness of new products and services.