Assuming you've already installed , within your Office app, click the Google Cloud Connect button and select Open from Google Docs. You'll then see a dialog box with all the appropriate files in your Google Docs document list. The dialog box is context-sensitive, so if you open it in Word, you'll see only Word-compatible files. In PowerPoint or Excel, you'll see only files compatible with that particular app.
If your documents list is really long, don't bother scrolling through all of your files. The dialog box includes a search field that you can use to quickly locate the file you're looking for.
Once you've downloaded the file, Cloud Connect will keep it synced between your local version and the version in the cloud. Whenever you save the file, it'll be synced to the cloud. And whenever one of your collaborators makes an update in the cloud, it'll be synced to your local version. (You can modify this setting to sync only manually, but I don't recommend it.)
By default, Cloud Connect saves files to your Downloads folder, but you can modify this to always use your Documents folder. You can also choose to have Cloud Connect prompt you every time you download a file, so you can always put it where you need it.