In 1982, Philips has to decide whether to build a CD pressing plant in the United States, and, if so, how big a plant. CDs were at that time an uncertain technology, and Philips was also concerned about the response of another possible CD manufacturer, Sony. Some strategies Philips might think about are:

THE PUPPY DOG PLOY.
Don't enter, so Sony won't enter either. A commitment would make us TOUGH, but then our rivals would become TOUGH too. So don't do it.

THE TOP-DOG STRATEGY.
Enter in a big way, so Sony will stay out. Make a commitment to be TOUGH, so our rivals will be SOFT.

THE FAT-CAT EFFECT.
Enter with a small capacity, so Sony will not feel threatened by the possibility of entry with a large capacity. Make a commitment to be SOFT, so our rivals will be SOFT too.

THE LEAN AND HUNGRY LOOK.
Stay out, so more resources can be put into other audio products. A commitment would make us SOFT, but then our rivals would become TOUGH. So don't do it.