The most frequent question asked about the Outlook Address Book is "why
won't it sort the way I want it to?" Simple answer. Even though we all know
that our Outlook Address Book is simply a view of our Contacts, Microsoft
did not configure it to abide by the settings we chose for our Contacts.
Instead, they hid the sort settings for the Outlook Address Book where no
one could ever find them.
Go to Tools > E-mail accounts > View or change existing directories or
address books > Outlook Address Book > Change… > Set your sort order there
Note that your options are only to sort by "First, Last" or by "File As." So
if you want your Outlook Address Book to sort by "Last, First," or by
"Company" you must have your Contacts' File As fields configured that way.