To configure Compatibility Mode in Windows 7 manually, just right click on the icon for whatever program you wish to change and select Properties from the menu that pops up. In the program properties window, click on the Compatibility tab and you'll be presented with options for which older version of Windows to run as, individual settings to force, and the option to run the program with Administrator privileges enabled. In the screenshot here, you can see that we are looking at some of the options for Skype.
Under the Compatibility mode section, you can check the box for 'Run this program in compatibility mode for:' and then select an older version of Windows from the drop-down menu. Depending on what operating system your older software was originally designed for, you may want to try a couple of different ones here until you get it to work. It is best to start with Windows XP (Service Pack 3) and work your way back.
Under the Settings section, these options let you force visual options like limiting the display to 256 colors or a 640x480 resolution. These options are especially helpful for very old programs (like something designed for Windows 95) that may not be compatible with current video cards.
The Privilege Level section gives you the option to run the program as an Administrator. This is helpful for when programs may need access to certain folders that are normally restricted. If the program works in Administrator mode but not for the regular user, you may need to change the folder permissions for where the application is installed, or perhaps change permissions in the registry.