A document having large (or high resolution) images might bogs down scrolling & navigation. Office 2010 address this problem by offering an image compression feature which lets user compress images to reduce the resolution and file size.
Make a copy of your document (then you can play with the settings without breaking your original) then open it in word. To compress the images, select the picture and select the Picture Tools Format tab, and click Compress Pictures. Choose “Use document resolution” and “All pictures in the document”. Click ok and save the copy of the document, you should then find the file size is smaller.
It is to be noted that this can reduce the quality of images, so be very meticulous in checking the image quality before saving the document. If the pictures look too low quality, make a new copy of the original and choose the “Print” resolution instead of “Use document resolution”.
If you want to apply these settings to all the images in your document, un tick this box for further space saving.