Identify which particular processes are generating the highest CPU. It's difficult to do this in Task Manager but I found using Process Explorer, a free utility from Microsoft Sysinternals a more useful method:
http://technet.microsoft.com/en-us/sysinternals/bb896653.aspx
Open Process Explorer and then click on the CPU column to put all the processes in order of CPU usage.
For an even more accurate method of working out which is using the highest CPU, click on the View menu and then click "Select Columns".
Click on the "Process Performance" tab and then put a tick in the box for "Context Switches".
Click OK.
This will add a new column called "Context Switches". Now click on the "Context Switches" column head to put them into order of Context Switches.
Context Switches is a good way of telling which of your processes are using the most CPU cycles.
Once you have identified which processes are using all of your processor speed you can work on fixing it.
You mentioned that Internet Explorer was using more cycles and that could be due to a number of reasons, however the main reason is usually the installation of the third party toolbar, such as Google toolbar, Skype toolbar or any combination of the above.
Each on of these toolbars adds extra load onto your browser, so try running the browser with the toolbars disabled, one by one.
You can enable or disable toolbars and addons in IE by going to Tools menu > Manage Addons.
If your browser works better without certain addons or toolbars, consider removing them or downloading a new version of them.
You can also run IE without any toolbars or addons using the "No Addons" feature.
Start Menu > Programs > Accessories > System Tools > Internet Explorer (No Addons).
Hope it helps.