Arguably the best way to start building power is to begin with the start product (air and fuel) and the finish product (exhaust). Get both of these flowing better to start freeing up ponies. This also opens up doors for other performance parts.
Get a good intake that will allow the engine to really breathe and an exhaust system that will get the exhaust out more efficiently. Keep in mind that when you pick an exhaust, bigger is not really better on a naturally aspirated engine (not turbo or supercharger). You want some backpressure to assist in the scavenging effect of the cyliders... not to mention that you will lose low-end torque as your exhaust gets bigger -but that get's us into a really technical discussion there...
So start with a good intake and exhaust and then work your way to the engine. Next work on your ignition components... Get a hotter coil and a good controller/amplifier box (like the MSD 6AL for example).
Cams, injectors, and a fuel pump can help you build a lot more power, but you need to choose them according to how you want the car to react.
I was in the local drag-race cicuit for 14 years ('71 Mustang 5.05 1/8 mi best time). Beyond just the essentials that I listed above, you'll need to get specific about what you want out of your car. Are you going to run it at the drag strip only, or is it going to be a street/strip car? 1/8 mi. or 1/4 mi.? Oval track? Street/Cruiser? Etc...
Nitrous is a good way to build instant power, but there are drawbacks to that too. To get a decent amount (enough to shave a few tenths off a 1/8 mile time) you'll want to change the cams accordingly as well as other key components. Again, this really depends on your intentions for the engine.
I'm more than happy to help in any way I can (and always happy to share the knowledge I've gained over 18 years of building & playing with engines
). If you like you can contact me via e-mail with any questions you have and I'll give you straight answers...
willmaier@mnmperformance.net
Hope this helped.