In 2006 MacWorld outlined 3 ways to move Outlook contacts to OS X Address Book. It's rather annoying that Microsoft doesn't provide a standards-compliant export from Outlook; they're usually a bit better about data mobility of this sort.
... Under Outlook 2002 you could simply open your contacts and drag them to the desktop to turn them into vCards. No longer. Try this and the contacts are converted to messages.
While you can select a single Outlook contact, choose File -> Save As and, in the resulting dialog box, choose vCard Files from the Save as Type pop-up menu, this works only for individual contacts—you can’t export a group of contacts this way.
You have a few options for eventually getting the things out of Outlook. The first is to select all your contacts and choose Action -> Forward as vCard. Outlook will create a new email message that contains all your contacts as individual vCard attachments. Send this message to yourself, pick it up on the Mac, drag these files into Address Book or Entourage’s Address Book and you’re good to go.
Or Sperry Software can lend a hand with its $20 vCard Converter Add-in for Microsoft Outlook. This adds a service that enables Outlook to export all your contacts as a single vCard. (Yes, it’s galling that OS X’s Address Book lets you do this for free.)
Or you can use a go-between application to get the contacts out of Outlook and into an application that offers more flexible export options. That application is the Windows version of the free cross-platform email client, Thunderbird. Within Thunderbird you’ll find the Tools -> Import command. Choose it, select the Address Book option, click Next, and in the Import window select Outlook and click Next to import your Outlook contacts into Thunderbird...
I tried the Action - Mail feature, but it doesn't work for 980+ contacts.
It's not on this list, but a few months ago I tried the export to Google to Address Book route. It was "ok", but I ran into problems with EX style x.500 email addresses.
So this time I think I'll try the Thunderbird option first, and if that's not satisfactory I'll try the (currently) $25 vCard converter add-in.
Once I have the Work contacts in OS X Address book, then they'll go to my iPhone ...
Update: Thunderbird had the same X.500 (EXchange server) email address translation problem as CSV export. Also, I couldn't limit import to a single contacts collection, it brought them all in. Lastly, it was very slow. If the Sperry product can do the x.500 to internet standard email translation I'll give it a try.