To optimize the Blowfish algorithm for a system with limited computational power, several steps can be taken. Firstly, reduce key size. While this may impact security, it significantly reduces computation time. Secondly, use pre-computed S-boxes and P-arrays instead of generating them each time. This saves processing power but requires more memory. Thirdly, implement the cipher in hardware rather than software. Hardware implementations are typically faster and consume less power. Lastly, consider using a lighter version of Blowfish like Twofish or Threefish which have been designed to be efficient on systems with limited resources.