Users could be in for less frustration as Microsoft makes flagship programs handle rival ways of saving documents, spreadsheets and presentations.
Office users will get more options for the way they save files
The initiative covers the Word, Excel and PowerPoint programs from the Office software suite.
The prototype of the first tool to translate between formats will be made available as a free download on 6 July.
Microsoft said it started building the software tools in response to requests from government customers.
Every PC user knows how careful they have to be when moving important files around because of the incompatibilities between different programs, such as word processors, that do the same job.
Saving a file in a format in one program can make it difficult to open in another, without sacrificing some of the way that the information in the file is laid out or formatted
Both Microsoft and the broader technology industry have been working to remove some of these problems by standardising the ways information is saved so it appears the same when opened by different programs.
Before now, Microsoft and the technology world have chosen to go their own ways.
The new initiative ends some of this diversity and will make it possible for anyone using programs in the Office software suite to save files in more so-called "open" formats.
Specifically, the tools will make it possible to save and work with files using the Open Document format - a specification developed by the open source community as an alternative to the proprietary formats used by large software firms.
Microsoft has been working towards a more open way of formatting documents based around the Extensible Markup Language (XML).
This helps preserve the structure of data in a document, such as a spreadsheet, so that relationships between figures are preserved as they are opened in different programs or used for other purposes.
"This tool promises to be a very significant development in the trend towards practical open document standards and, critically, customer-friendly means to move between them," said Andrew Hopkirk, director of the UK's National Computing Centre's e-Government Interoperability Framework (e-GIF) programme, in a Microsoft statement.
Some of the free tools will be add-ins for older versions of the programs in the Office suite, said Microsoft.
Prototypes of the translation tools will be made available via the SourceForge website which allows anyone to participate in the software development process.
The Microsoft-led project is being carried out with three other companies - French firm Clever Age, Aztecsoft in India and Dialogika in Germany.