Information Architecture (IA) is the way you structure your stuff to make it easy to navigate and to manage.
The underlying IA influences your navigation and page layout.
There isn’t a right way. There are always lots of options, and picking the best is a matter of weighing various factors including user goals, environment variables (such as bandwidth and screen resolution), technical architecture, time and effort, search engine compatibility, logic and plain old common sense.
Sometimes, simple content structure is obvious. For a simple brochureware site, you might only have Home, About Us, Services (and/or Products), and a Contact Us page. You might choose to put news snippets or press releases on the Home page, or you might choose to have a separate News section. That’s an Information Architecture decision.
Taking the placement of News items as an example, there are several considerations that you might take into account:
For a simple e-commerce site, you’d add your list of products, and a shopping/purchasing process. The products may naturally belong in separate categories.
With more content, there are more choices to make, and the way you choose becomes more important. It simply isn’t possible to describe everything on one page; you have to start splitting a site up into sections, and provide useful navigation between those sections.
The most obvious starting point (particularly to clients) can be to arrange content on the web site in the way it’s arranged in real life.
For example:
An alternative approach is to follow your users’ goals and structure your pages around their likely flow through the site.
For example:
These types of content or function don’t necessarily map to the organisation’s own structure or product range. They’re designed around the needs of the different groups that might use the site.
Sometimes, it is appropriate to offer many views, not a single rigid hierarchy.
Taking an online bookstore for example, which shows how you can offer many routes to the same content, and show that content in many different views:
Information Architecture is a huge topic with its own text books. In general, though, it is common sense. There are lots of ways to arrange content and functions, and it’s usually a case of working out which will work best. It’s hard to get it very wrong; the goal is to let different types of user succeed.
The previous WDFS site used a simple Information Architecture. It’s basically a wide, flat collection of 50 articles, including the home page. Any article could be accessed from any point, because the whole structure was exposed via the side navigation.
Note: I’ve now split the site into several sections, organised by topic. The main reason for this is that my old Tutorials section was getting too big and unwieldy, and I wanted to add lots more tutorials on specific production techniques.

While this is a very straightforward model, it could take quite a lot of decoding to scan and navigate this many elements. For that reason, I’ve overlaid a pseudo-tiered structure, which arranges the articles into main sections (Home, Basics, and Principles), and sections within those (such as ‘Web design process’, ‘How people use web pages’, and ‘Other online factors’ in the Basics section). Note that this isn’t a real-life order: it doesn’t represent any particular workflow or even directory structure

In addition, some pages provide cross-reference links to others, and some pages which introduce their sections link to multiple articles within the section. The result is a rich, unstructured, web-like architecture.

This is appropriate for situations where:
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