1. Just tried this on my iPhone 3G 16GB, which was running incredibly slow (keyboard sometimes took 5 seconds to respond to a keypress; apps. took forever to fully launch). Reboots alone did not help.
I went to Settings -> Safari and deleted the history, cookies, and cache. Then rebooted. Much much better.

OR

2. reboot iphone

OR

3. software restore.

OR

4. I had the slowest phone in town after the upgrade to 4.0. I was searching for an easy fix, hopelessly. I tried that hard reset (holding the power & home button until the power off appears) and I had to do it about 3-4 times, but after that magic number, now my phone is operating as promised. I can't remember who suggested it first - but i THANK YOU!!!!