Not my experience with any Office 2021 v16.63.1 application on Monterey 12.5 with my MBP M1 Pro. All apps work quickly and reliably. The advice to ensure current application updates is sound, though Office should do this automatically as it does for me. Have you installed any MS Word add-ons that may be contributing to your issue?
What else do you have installed on that Mac that may be usurping system resources? Any Anti-Virus, or so-called cleaner applications that may be collaterally impacting your Office application behavior? If so, those should be thoroughly uninstalled per their vendor's instructions for removal.