In practice, many different squashing functions are used. Kosko and Taber for example suggest the use of a simple binary function, but more complex functions are possible as well. However, it is surprising that literature does not place much emphasis on this topic, although the chosen function strongly affects the results. Identifying concept-specific squashing functions is very important, unfortunately, so far no publication has yet dealt with that problem.
To get an idea what squashing functions do please have a look at this article.