There are tons of different kinds of electric guitar pickups and pickup configurations. Most electric guitar pickup problems are either caused by damage or improper pickup placement and height. The majority or electric guitar pickups are "floating pickups." A floating pickup is mounted to the guitar on a pickguard or a pickup ring with a spring placed in between the pickup frame and pickguard or pickup ring. The spring allows the pickup to "float" in place. The pickup can be raised or lowered in relation to the body by tightening or loosening the mounting screws. Tightening the screw forces the pickup frame toward the pickguard or ring by compressing the springs. Loosening the screws will do the opposite--thus, a floating pickup. A floating pickup allows you to create different tonal qualities by adjusting the height of the pickup.
A hard mounted pickup, on the other hand, is bolted directly to the body. The pickup's height is not adjustable at all. The height and placement of a hard mounted pickup is set when the pickup cavity is routed during construction of the guitar. You might ask why would any want a non-adjustable pickup. Well, direct mounted pickups give the guitar more sustain. The pickup is vibrating with the body because it is permanently attached to it. Floating pickups basically don't even touch the body at all. This is the main reason why many expensive, modern electrics have direct mounted pickups.
Setting up your floating pickups is pretty simple. Obviously, you can your pickups up for any kind of playing style. If you are working on someone else's guitar, make sure to get a feel for what they want their guitar to sound like. Since pickups are basically little microphones picking up the sound waves reverberating off the strings, the electric guitar pickup will pick up more sound the closer it is to the strings. The opposite is true when the pickups are farther away from the strings. Unless you are a player who needs a special setup, pretty much all you want to do is adjust the height so all the pickups are the same volume.
So plug your guitar in and play the low E string right above the bridge pickup. Listen to the volume. Now do the same thing with the high e string. Raise and lower each side of the pickup until they are the same volume. Now move to the neck pickup and do the same thing. The last thing to check is the pickups in relation to each other. In other words, is your bridge pickup louder than your neck pickup? You'll want to adjust the height of each pickup until they match the volume of the other pickups.
That's it! That is a basic electric guitar pickup setup.
Installing electric guitar pickups can be simple or complicated depending on what style of guitar and pickup configuration you have. Each style of guitar requires a slightly different process. Here is how to install pickups on different style electric guitars.
Most Fender guitars have pickups that are mounted to the pickguard. Leo Fender came up with this design for manufacturing logistic reasons. He found that he could make guitars faster if he did not have to wait until the guitar was finished to install the pickups. Leo mounted and installed all the guitar electronics on the pickguard while the rest of the guitar was being finish. Then when the guitar body was ready for assembly, Leo could just screw on the pickguard and wire it up. Pretty neat, huh? Well, here is how you do it.
First, remove the pickguard by unscrewing the small screws on the outside of the pickguard. I like to put a piece of tape down on my workbench and stick the small screws on the tape once I remove them from the guitar. It's a good way of not losing them. Once you have all the screws off the pickguard you can pull it away from the guitar. Be careful because the pickups are still wired to the guitar. Peel the side of the pickguard opposite of the electronics away from the body while keeping the side of the pickguard with the pots and switches close to the body. Flip it until you have the pickguard laying upside down next to the guitar body with the pots closest to their cavity.
Now that the pickguard is removed from your guitar you can remove the pickups. This might sound simple, but be careful. The springs that float the pickup are compressed in place. Once you unscrew the pickup, the springs will go flying out. It's happened to everyone. Just take your time and watch for the springs when you loosen the screws.
After the pickups are removed, you can disconnect the wires. You can either cut the wires to the old pickups, or you can warm up the solder joints on the pots and switches with a soldering iron and lightly pull the wiring away from the electronics.
Once the old pickups are completely removed from your guitar, you are ready to install the new pickups. You will need to find the correct wiring diagram for your pickup-pot-switch configuration. After you have your diagram, I suggest installing the pickup into the pickguard. This will fix the pickup in position and get it out of the way while you are wiring it in place. I have written an entire article about how to wire, solder, and install pickups on a Fender Stratocaster. Please visit my Fender Stratocaster pickup installation article for more details. Also, you might want to check out my article on how to properly solder electric guitar electronics.