Although Microsoft publicly testifies from every available pulpit of their deep longing for multiple document formats, a quick glance at reality shows that this love remains unrequited in their products. For example, what new formats does Office 2007 include out of the box? A new Microsoft XML format (OOXML), an updated Microsoft binary format, and a different new Microsoft binary format for Excel. So Microsoft clearly loves multiple Microsoft document formats! (Discuss among yourselves whether this love is amour de soi or amour propre.) But what about other, standard formats? ODF support is available only as a separate download, in their ODF Add-in for Word. However this tool is very poorly integrated into the Office user interface, making it almost impossible to use for real work.
For document exchange between different versions of MS Office, on the surface it looks a little bit better. Office 2007 provides a “compatibility mode” for users of Office 2007 who wish to create or edit documents that will remain compatible with earlier versions of Office.
That’s the theory at least.
In practice, things are rather messy. I recently received an email from Julie Watson, a project manager who has been doing enterprise deployments & migrations for 15 years. She has spent the last few months working on a plan to migrate 18,000+ workstations, trying to find a way to have a gradual rollout while still maintaining round-trip collaboration between her Office 2003 and Office 2007 users. Julie has put together a nice report showing what works and what doesn’t. Ignore the official documentation and ignore intuition, since neither will serve you well here. Take a gawk at the seedy side of reality in “[Compatibility Mode] Confusion in Office 2007.”