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Argus Associates, Inc. Closes Shop
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Posted On March 26, 2001
Argus Associates, Inc. (http://www.argus-inc.com), a leading firm in the nascent field of information architecture (IA), is closing shop as of March 30. After doubling its sales last year, the company expanded staff and moved into new offices—with another expansion planned for later this year—but experienced a sharp drop-off in sales starting last October. On March 13, the company announced plans for an "orderly shutdown" of its business.

Lou Rosenfeld, co-founder and president of the Ann Arbor, Michigan-based company, said: "We did about $3.5 million in sales in 2000, and were planning for another year of record growth in 2001. But our fourth quarter in 2000 was terrible. In the past, we could discuss a potential $250,000 contract with major corporate customers. Suddenly, large customers were taking their time deciding on a $25,000 project. Decision makers were asking tough questions about ROI [return on investment], which is hard to quantify in this field. And by January, when the economic jitters really became epidemic, it seemed no one wanted to spend any money."

The company had reached a staffing level of about 40 employees, which it expected to double this year. Instead, there have been two rounds of layoffs since January. This month, Rosenfeld concluded that "our business model—focusing solely on project-based information architecture consulting—just could not survive such a rapid downturn." The remaining skeleton crew is to be laid off by the end of the month.

The sudden change in the business climate took Argus by surprise. "In the summer of 2000, we were having trouble attracting qualified people. By January we were laying those people off," observes Rosenfeld. He insists the Argus situation differs from the now-familiar dot-com failures. "We never were a dot-com, and few of our customers were dot-coms. We performed a real service, filling a real need, with a very contented clientele."

Ironically, the company may be a victim of its own success in promoting the field of information architecture. Rosenfeld and Argus co-founder Peter Morville wrote a best-selling book, Information Architecture for the World Wide Web, which Amazon.com chose as its Internet book of the year in 1998. Argus' staff members gave popular presentations at workshops and national conferences, while Rosenfeld wrote a column deconstructing highly visible Web sites for Internet World. More recently, the company launched the Argus Center for Information Architecture (http://argus-acia.com), which was devoted to educational and outreach efforts.

These efforts helped induce many information professionals to repackage themselves as information architects. "We helped popularize IA to the point where lots of companies have in-house information architects. I believe our people had more knowledge and experience than many of these new IA folks, but if a company already has an information architect on staff, it's harder to justify hiring a consulting firm in the same area." Most of Argus' professional staff had a library science background, the majority holding M.L.S. degrees. (A list of Argus employees available for new positions appears at http://argus-inc.com/contact/argus_alumni.shtml).

Laying off staff has been painful for Rosenfeld. "It's like amputating your own limbs. We recruited some very talented people recently from Australia, Sweden, Canada, and even the east coast of the U.S. Sometimes it's harder to get someone from Boston to come to work in the Midwest than it is to get someone from  abroad." He takes solace in the fact that his staff members have received multiple inquiries from potential employers—some from as many as 30.

Rosenfeld said that he and Morville chose an orderly shutdown in lieu of the corporation filing for bankruptcy because "it seemed to be the right thing to do. We've always paid our staff and our bills, and we want to continue to do so." The process is not easy, he says: "You feel like you're attending your own wake. You have to continue to come to work each day, but instead of creating, you're dismantling what you've built." The company is winding up work on some existing contracts.

Roy Tennant, a digital libraries expert at the University of California, posted a requiem to his Web4lib mailing list, saying: "With Lou Rosenfeld and Peter Morville in the lead, Argus was instrumental in fostering and helping to define the nascent information architecture profession. They quite literally wrote the book on it.... As librarians, Lou and Peter provided a perspective on this field that was unique among those active in it. They amply demonstrated the utility of librarianship to the interdisciplinary field of information architecture."

Despite the death of the company, Rosenfeld remains optimistic about the field. "This is a hiccup. I am not concerned about the future for librarianship or information architecture. The information technology revolution isn't going away; there will always be a need for what we do. Actually, that need is growing exponentially, even if the demand doesn't always keep up with that growth." Rosenfeld hopes to continue his writing and lecturing projects, and he and Morville hope to keep the Argus Center for Information Architecture in operation. Can he contemplate a revival of Argus Associates itself? "I can't think about that possibility right now" he says.


Richard W. Wiggins is an author and speaker who specializes in Internet topics.  He is a senior information technologist at the computer center at Michigan State University.

Email Richard W. Wiggins
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