Engine - 998 tuning, further options 

MSC/MM - Mini Spares Centre/Mini Mania 
BBU - Big Bore Unit (refers to all 1275cc-based units) 
SBU - Small Bore Unit (refers to all sub-1275cc units, here the 998) 
BHP - Brake Horse Power 
CR - Compression Ratio 
Following on from the easily bolted on performance enhancing components out-lined in the stage one section, we need to consider where to go to get more power output. 
To improve engine out-put, you need to increase the engine's 'breathing' ability. The stage one kit deals with all the easily bolted-on external parts, and represents the best increase for investment. From here on in the power increases will cost commensurately more money. Power production of any engine, once the 'breathing apparatus' (induction/exhaust system) has been dealt with to cause no restriction - or certainly minimised where use of relatively standard major components such as the carb is concerned - is down to the cylinder head and camshaft. Both play a vital role in improving the engine's ability to breathe. The head through improved airflow by way of modification or replacement, the cam through increased valve-opening periods. How far these modifications and changes should go are dependant on what the engine is to be used for, or the power output required. 
Books have been written on these subjects; here we're dealing with sensibly priced options for reasonable gain in engines that are used every day. Waxing lyrical about the virtues of this or that cam, and so-and-so's or such-and-such's cylinder heads are all well and good - but mean nothing without hard, practical proof. Consequently the following will be based on recent tests carried out by me to assess such changes. 
Cylinder head. 
After the stage one kit, this is the next easiest option as far as fitment goes. It's almost a 'bolt-on' part, but is a little more involved and a little more costly so is moved up a category. 
The standard cylinder head is pretty restrictive where bigger power outputs are the main aim. To make appreciable gains it needs a fair amount of work done. Simply carrying out 'stage one' port, chamber and polish mods really don't do much at all for your money. The only sensible option is a standard head modified to 'stage three' spec, or a 12G295/12G206 Cooper head. Using a BBU 12G940 casting is an option - but not terribly practical (see 'Engine - 998 tuning, fitting a 1275 head'). 
The much coveted 12G295/12G206 heads are all-but non-existent realistically now. There are some about - most have been well used and abused, many cracked or modified into uselessness, with just a few, rare, un-molested examples of the species. But even a good example is likely to need complete refurbishment, particularly for the modern world where unleaded fuel is to be used. Suitable exhaust valve seat inserts will need fitting, new guides, seats re-cut, probably new valves, valve stem seals, and in all probability new valve springs. And then there's the machine-work needed to get it to work on your 998 - hefty re-facing to get CR to a sensible level since the standard head has a capacity of 24.2cc, the Cooper heads 28.4cc. That's a chunk to remove; charged by the cut it'll cost plenty. And having gone through all that - reliability is a problem - they're prone to cracking. 
That leaves us with the 'stage three' spec modified standard head. MSC/MM sell heads modified by myself (Min Tec). The valve sizing is as that of the Cooper heads with all necessary port and chamber work carried out to give the best flow gains available within limiting criteria and inserted for unleaded fuel use. The main limitation is the combustion chamber - modifications are kept within sensible bounds so suitable chamber size is obtainable without excessive cost. To improve the chamber beyond that used would require large amounts of material to be removed off the head face. This generally breaks in to the rocker gear oil feed gallery necessitating this be brazed up, re-routed, and re-faced to true. The small improvement available simply doesn't warrant the extra costs incurred to do this. Even so, flow testing (results below) has shown that this style of stage three head all-but matches the inlet flow of the Cooper head, with better exhaust flow results so offers directly comparable performance, are available 'off the shelf', and are far, far more reliable. Particularly when comparing the figures below 0.350" lift as the cam/rocker combinations used only reach 0.340" lift. 
0.050 16.7 16.0 19.7 18.3 17.9 16.0 
0.100 32.5 27.1 36.4 35.3 38.2 29.7 
0.150 42.6 38.1 51.1 49.6 51.4 41.9 
0.200 50.2 47.0 62.8 57.2 65.2 52.5 
0.250 55.8 51.4 71.4 61.4 73.5 57.2 
0.300 60.4 54.6 78.9 64.5 81.1 61.0 
0.350 63.8 56.9 84.3 66.8 87.0 63.6 
0.400 65.3 58.9 88.9 68.9 91.8 65.1 
Superflow 600 fully computerized flow bench. Tested at 25-in of water. 
Flow test readings are average of all ports tested on one of each cylinder head types. 
Off the mark, a camshaft change to something more suitable will give you more 'bang for your buck' compared to a cylinder head. Having said that, it will not give initially as much power with the standard head as a stage three head will with a standard cam. 
There is a multitude of camshaft options available, and most of them will have been tried by some one, somewhere. The problem is, many of them will have been tried in combinations that really didn't suit them - be this the wrong combination of parts, or used for the wrong application. It's no good fitting a camshaft that doesn’t start working until 5,000rpm shows on the tacho when you spend almost all your time driving in traffic. Likewise, a mild road cam isn't the best option for a circuit racer. Unfortunately, too many folk get lead down the wrong path here, and end up with a completely unsuitable cam for their particular situation. No more so than where road use is concerned. 
I've run the gambit on just about every size of Mini engine in almost every possible situation along with a huge variety of camshafts. One thing stands tall above all the others - I have nearly always gone back to a relatively mild profile for roadwork. Something that gives it's best between 1,500-5,500rpm almost irrespective of engine size. The reason being this is where you tend to spend most of your time when driving on the road. Needing to run much over this means you either have an unsuitable final drive ratio, or just use the engine for scaring the local community at the weekend. 
Considering the engine size and the operating range, this really does cut down camshaft choice to something in the 'mild' as opposed to 'wild' area. In my book the 997 Cooper profile takes some beating and would be my first recommendation to anybody wanting a decent road-burner. Or did until a few months ago - but more of that in a moment. It gives the right spread of power without being fussy or peaky. And the gain is pretty impressive over the standard item in an otherwise completely standard engine. Not only that, but it will idle smoothly and quietly and give emissions passing CO and HC readings. Something many of the 'modern' breeds of camshafts simply can't do without much frigging and fudging. With this in mind it was my first choice for the test I recently carried out for Mini Magazine where the criteria given matched almost exactly the aforementioned points. 
Unfortunately I'd already built and installed the engine before I got my hands on one of Swiftune Racing's SW5 cams. This is the one I really would have liked to test, as it is something new that has been giving unbelievable results in practically all engines it's been tried in. I'm not allowed to give out specific details, what I can say is it is a 'modern' version of the 997 Cooper cam - which goes to prove that the old profile was pretty good in the first place and hard to beat by later 'developments'. 
Rocker Gear. 
It's pretty widely known that high-lift rockers don't give good results on 998s. The standard rocker gear, however, is a little short on what's required. Despite being 'accepted' as giving 1.25:1 ratio, they don't. You'd be lucky if the pressed steel versions give 1.23:1, and wildly lucky if the later sintered type gave 1.22:1 (they generally only manage a paltry 1.21:1). The 998 needs around 0.340" valve lift to make good use of the head mods - but not much more. The 997 camshaft has a lobe lift of 0.263". To get the required lift means rockers with a real lift ratio of 1.3:1 are needed, so I used the MSC/MM 1.3 roller-tip versions for the SBU. These give the required lift within a few thou. 
As a footnote to this section, using the SW5 camshaft means sticking to the standard rockers as it develops more lift at the lobe. 
Power Gains. 
So what do we get after all our deliberation and hard work? The tests were carried out on the same rolling road I use for all my testing now that I live in the 'northern wilds' - GRV at Littleborough, home of the British Vita Racing Cooper Ss run by Harry Ratcliffe and Geoff Goodliffe (the 'G' & 'R' in the title). The exception was the stage one kitted Mini with a stage three head fitted. This was done by a good friend of mine, Steve Harris (ex-Downton man and well known Mini engine builder). But this doesn't matter over-much as actual bhp readings are not what we're looking for, as they are meaningless considering standard power outputs vary so much. It's the percentage we're interested in for comparative purposes. 
A good, low compression 998 gives 30bhp. A good stage one kit (mod1) boosts this to 36bhp. The 997 Cooper camshaft and standard head (mod2) gave 42bhp and the 997 Cooper camshaft/stage three head/1.3 roller-tip rockers combination (mod4) gave 48BHP. Using percentages is a more relevant way of comparing results from different sources, so converting the aforementioned we get the mod1 kitted motor giving 20% more, mod2 giving a 40% increase over standard, and mod4 giving a whopping 60% over standard! Add into this equation the 43% increase that Steve Harris got by adding a stage 3 head to the stage one kit (mod3) on a standard engine and we've a full house of results - 
Percentage power increase with each step: 
Stage one kit +20% 
Standard engine plus 997 Cooper cam +40% 
Stage one kit plus Stage 3 head +43% 
Stage one kit plus 997 Cooper cam, stage 3 head and 1.3 rockers +60% 
A 60% increase is mighty impressive - especially when you consider it still idles sweetly, gives very low CO and HC readings at idle without any MOT/vehicle testing 'fore-play', and actually gives more miles per gallon than standard! I largely suspect the Swiftune SW5 cam would give a few more bhp, but more importantly an increase in the over-all torque out-put - the most important factor for a street unit. 
Useful part numbers: 
C-AHT88 Stage three, unleaded SBU cylinder head assembly 
C-AEG588 1.218" diameter nitrocarborised EN214N inlet valve 
C-AEG589 1.040" diameter nitrocarborised EN214N exhaust valve 
C-AJJ4037 Manganese-bronze valve guide - set of 8 
C-AEA526 Dual valve spring set - 180lb 
TAM2068 Lead-free exhaust valve seat inserts 
ADU4905 Stem seals - latest top-hat/sprung type 
GUG702506HG SBU genuine Rover head gasket 
KC567M A+-drive type 997 Cooper profile camshaft 
KC948 Pin drive type pp7 Cooper profile camshaft 
C-AHT405 1.3 ratio roller-tip rockers, SBU only 
AJM601 Exhaust manifold gasket 
GUG705009VC Rocker cover gasket 
GTG101 Thermostat housing gasket 
88G221 Heater tap gasket