Systems Engineering is described as a transdisciplinary approach that integrates all disciplines and specialty groups into a team effort, developing an innovation from concept to fully operational system. However, its procedural nature has been viewed by some as inhibiting innovation. By considering the whole of the innovation cycle, we demonstrate that Systems Engineering is actually essential to overcome the so-called valley of death in terms of technology readiness. Drawing on two case studies of knowledge management in large organizations (one government and one private industry), we show the benefits of a perspective in which the organization is viewed as a system through which dispersed explicit and tacit knowledge may be integrated to support innovation. However, this relies on appreciations of the full range of different knowledge types and the importance of organizational culture in the knowing and action cycle. The importance of organizations and the individuals within them adopting systemic thinking and systematic effectiveness are essential attributes of innovation: these are embodied in the discipline of Systems Engineering.