I write all my books in Scrivener. It's similar to Word except that it is really easy to shuffle chapters around, chop and change, go back through your revisions and so on.
I begin a new folder for every chapter and scribble down as much as I can, regardless of how rubbish it might turn out to be. One of the keys to turning a blank page into hundreds of pages is giving yourself permission to write "shitty first drafts".
I also chop up the typed diary entries and paste them into the appropriate chapters.
I realise this is veering into a "how to edit a book" response, so I'll leave that aside and stick to the tools I use.
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