Extreme Slowdown on Macbook Pro

I have a 2011 Macbook Pro (core i5), running OS X Lion. The guest OS is Windows XP, and is configured to have approx. 1 GB of memory. The computer runs frustratingly slow - I usually click to open a program and then go make lunch (that much of a slowdown on both OS's). Yet on a 2006 Macbook, the same setup runs relatively smoothly (every once in a while it will slow significantly for a second, then it picks back up). Are there some specific settings that can be adjusted on the Macbook Pro to bring the speed up to a reasonable level?

Also, when Parallels is closed, OS X runs without a problem, and the slowdown occurs regardless of the guest OS. So it seems logical to assume the problem lies with Parallels.

 

please check this kb http://kb.parallels.com/en/112091