(FORTUNE Small Business) – Microsoft's clockwork-like biennial upgrade of its Office productivity suite will be on store shelves and pre-installed on new PCs by the time you read this. On one level, it's impossible to conjure what's left to put in Office XP, but then, on the other hand, what couldn't be a little better? Microsoft has focused on organization, customization, collaboration, and integration, and while there aren't really any home-run features, there are enough singles to consider making Office XP part of the team.

I've been running Office XP Professional (a $330 upgrade), which includes FrontPage and Access as well as the core programs, for a month. Setup and installation were a breeze. Really. Yes, I did have to make the inevitable and mildly annoying trip to Microsoft.com because "Office XP requires newer Windows system components not detected on your computer." Surprisingly, installing these turned out to be relatively painless. (If you're still a Windows 95 user, though, it's upgrade or bust, as Office XP won't run on Microsoft's old operating system.)

Microsoft says Office XP features a streamlined user interface, but to me XP doesn't look much different from Office 2000, with one notable exception: Clippie, that annoying little paper clip that intrudes at the bottom right corner of your screen whether you need help or not, is now turned off by default. The only other thing that struck me was Word's increased letter and word spacing and improved "readability," although that wasn't particularly evident elsewhere in the suite.

The best new features of XP are the cross-application ones--they work no matter which program you're running. Most notable is a task pane on the right side of the screen in which you can access routine functions, advanced features not easily found in the menus, and files. This is similar to IE's Explorer bars, and I really like it because it lets me keep everything in one place; I don't have to waste time searching. But when I launched a new document in Word, the task pane disappeared and I had to go to the View menu to retrieve it. There should be a button that lets me open it as easily as I can close it. If Microsoft fixes this, call it the "Brian Clark button."

Another big addition is Smart Tags. These buttons work across different applications and appear in a file whenever a program thinks you need them. For example, if you make an error in a Word or Excel file, a Smart Tag suggests a correction. They also let you easily paste names, addresses, and other data from one program into another if you want to, say, insert an Excel table into a Word document. They can be big time-savers and can be ignored by just continuing to type.

New and improved collaboration features are worth a look for project- and team-driven businesses. send for review lets users work together on a single file, smoothly managing the sign-off process and integrating multiple users' input. SharePoint, which is an intranet site for your business, is the newest addition to the suite, and it represents Microsoft's boldest move toward Internet services. Users can share documents, schedules, or contacts, storing them online for access from anywhere. You can put up different document libraries for different accounts, conduct surveys, or converse with employees through discussion boards. Instant messaging, though, is not yet fully integrated into SharePoint for live online collaboration. For now, SharePoint services are free with the purchase of Office XP.

If you've ever lost an entire day's work when your computer crashed before you hit SAVE, you'll be happy to know that improved data recovery is a new addition to Office XP. When errors occur in an application you can choose to save files, so even if an application crashes, you can save everything you just added--it's virtually impossible to lose changes. There's also a way to shut down applications when they stop responding and to initiate the recovery of a document at the same time. A two-birds-with-one-stone approach, if you will.

So does all this justify the upgrade cost? Well, if you use Office 97 or something earlier, XP is a quantum improvement, so the answer is a definite yes. If you're already a satisfied Office 2000 user, though, an upgrade is clearly less desirable.