I don't think there is an easy and direct way to just run a PHP script to convert Word documents to HTML, because .DOC is a proprietary format.
The best I can imagine is (if your server is running Windows) you might be able to take advantage of COM, and write a COM script to run Word on the server, to convert the .DOC to HTML. This would probably be very resource-intensive, also.
See http://www.php.net/manual/en/ref.com.php
I think there are also methods with MSSQL and OLE-DB (or something like that) to allow the database to interact with Word documents, which might allow some sort of conversion and display.
This is all going to be a lot of work, though. Why not just create a small macro in VBA for Word, and tell your users to download and run the macro, which will convert the current document to HTML, and prompt for upload. (Shouldn't be too hard, VBA can even create an FTP connection, and upload the document, if you want)