How do i properly sharpen a RAW (CR2) file?

I have been told that RAW files from my Canon 500d are naturally a tad soft and this is evident when in lightroom and blown up. I am using the kit lens atm but taking into consideration the poor quality of the lens most of my images are soft when blown up, i mean for reins on a horse from a distance they just look a blur. How can i sharpen them properly using Lightroom 3 or Photoshop Elements 8 (latest ACR)?