Wakeforest22890
Snowpom
It's hard to describe, and the HT article is vague. Essentially, if you play 1 IM, then he will play to 100% of his capacity. If you play 2, because of 'crowding' in the midfield, they won't be able to play towards their full capacity (people speculate that they utilize 90~95% of their skills). Playing 3 IMs makes them even less effective.
Playing 1 or 2 CD actually improves that defenders performance (IIRC), and playing 3 is just normal. 1 forward = improved performance, 2 = normal, and 3 = slight 'crowding' penalty.
With that said, remember that midfield used to be king. Now it's still viable, but the playing field has been leveled by slightly limiting the effectiveness of a stacked midfield and making defensive formations more desirable. If you want to win midfield, you still need to play 3 IM formations; however, you just won't win midfield by as much as you used to.
Also found this in the manual HTTD to answer the earlier question:
"Worth knowing is that when more than one player plays in a central position (central defender, inner midfielder or forward); they will not be able to contribute to the team ratings with their full capacity. This contribution loss is also greater for three players than for two. The logic behind this is that as soon as more than one player plays in the same area, they start to rely on each other and thus aren't able to contribute with their whole capacity.
In short, a sole player in a central position contributes to 100%. Using two players in a central position means a contribution loss (affecting both), and using three means a bigger loss (affecting all three). This loss affects all skills of the player.
The size of the contribution loss is bigger for inner midfielders than for forwards, and bigger for forwards than for defenders. More exactly the loss for inner midfielders is around twice that of defenders, with forwards roughly in the middle of the two."