Overclocking increases the speed/frequency in Hz of your CPU/processor, RAM, Videocard's CPU and RAM. These days, you usually use software which came with your motherboard, or video card to over clock your chips instead of going into the BIOS/CMOS during computer start up like the 1990s-early 2000s.
It is important to have good cooling from fans or other type of cooling like Liquid cooling, and a reliable higher wattage power supply since overclocking also makes your computer use more power which a lot of cheap power supplies which are installed on a HP, Dell, or Acer PC does not have the wattage on the power supply to handle the increase power needed to overclock. A 80Plus 500W Cooler Master or Antec power supply is pretty good for overclocking in most cases.
I recommend MSI Afterburner for overclocking your PCI-Express video card :
http://event.msi.com/vga/afterburner/download.htm
I'm not sure if it is still worth your time to overclock your RAM, and CPU since most newer games these days rely more on the video RAM on your videocard, and the CPU/GPU on the video card as well, and the CPU, and RAM speeds of modern desktop PCs are fast enough for most programs and games. You just need enough RAM to run programs.
But, if you want the extra speed, overclocking the CPU, and Memory could be a good choice instead of buying a new PC to run more intensive programs and games.