Hello Joseph Gundel:
You have to install the Eclipse Update from (...\KSDK_1.1.0\tools\eclipse_update\KSDK_1.1.0_Eclipse_Update.zip). Follow the instructions in the KDS section of the manual "Getting Started with Kinetis SDK" inside of KSDK doc folder (...\KSDK_1.1.0\doc).
However, I highly recommend you to install the latest versions of both tools, I mean KDS v3.0.0 and KSDK v1.2.
Regards!
Jorge Gonzalez