This paper describes the solution developed by Michigan State University to increase the institutions capacity for strategic innovation while respecting the Universitys limited financial means. One element of Michigan States strategy has been to send cross-institutional teams to participate in the Knight Collaboratives Wharton-IRHE (Institute for Research in Higher Education) Executive Education for Higher Education program. Team members learned about strategic tools for organizational change and then applied them in the Universitys situation. The tools and strategies for institutional transformation include: (1) the achievement of joint gains; (2) strategic agility; (3) directional focus; (4) leadership; (5) collaboration; and (6) communication and responsiveness. The combination of braid expectation and accountability, accompanied by individual discretion in the method used to advance ones strategy, has created a climate of remarkable collaboration at Michigan State. The same cross-functional team approach has been taken to the evaluation of strategic initiatives, and there is no doubt that a major part of Michigan States strategy for increasing effectiveness is investment in people. At Michigan State professionals at every level know how to act strategically and understand how their actions strengthen the University as a whole. (SLD)