I would like to know what kind of tool you use for writing your specifications. I think it's essential to use a tool that supports some kind of plain text format so that one can control the specification with a source control system like SVN. For the specification as for the code as well, it's important to have a history of all changes.At present we write our specification in a XML format. TeX would also be an alternative, but it's hard for people who have never been working with it.So let me know, what kind of tools or formats you use for specifications.
yup, try diffing a Word doc with TortoiseSVN.