Pack is the point at which the shock becomes very stiff, as the oil is unable to flow through the holes in the piston quickly enough. Increasing pack (smaller hole pistons, lighter oil) reduces the piston speed that is needed for the shock to stiffen up. Decreasing pack (larger hole pistons, heavier oil) does exactly the opposite, it takes a higher piston speed to make the shock go stiff.
Generally on a rough track you would reduce pack to allow the suspention to work on smaller, higher frequency bumps. Reducing the pack too far will make the car bottom out when landing from bigger jumps and can sometines also make the car harder to drive. I always try to run with as much as I can get away with but keeping the car stable though the rougher sections of the track.
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