One of the major engineering feats associated with shipping Office is making sure it runs fast enough.  This effort, which we classify under the broad heading of "performance" includes responsiveness (how quickly a button responds when you click it), throughput (how fast Excel can recalculate a spreadsheet), and "perceived" performance (do the fade out of menus seem right?)  Depending on the program, there might be other issues as well, such as network throughput and latency issues, document save/load times, graphics rendering engine speed, etc.

A software legend has somehow arisen that Microsoft waits until the last release candidate and then tunes up performance at the very end before the software goes out the door.

Nothing could be further from the truth; good performance needs to be fundamentally designed and architected into the product--something far too risky to do at the last minute.  From Beta 1 onward, a large portion of the resources of Office development are spent making sure that the software is speedy enough: testing on memory-constrained computers, processor-constrained computers, terminal services, Run From Network, x64, and all sorts of different configurations.

From the perspective of the Office 12 new user experience, performance is critical.  The very visual nature of the Ribbon, with lots of galleries and Live Preview, lends itself to experimentation.  A key goal of the Ribbon is that it's easy to poke around to find and use new functionality.  However, most people will only poke around if the interface is responsive and crisp.  For example, if it took two seconds to switch between tabs, it might dissuade you from browsing the Ribbon as readily.  In fact, we've noticed a profound link between performance and usability; some usability tasks that totally fail when the interface is laggy and lethargic suddenly do great once the software is responsive enough.

With the huge number of improvements in Office 12, making sure the software is responsive is a really critical task.  But it's one that we're totally committed to, because great performance is one of the fundamental building blocks of great software experiences.