At the beginning of a project a card sorting exercise will guide the business owners towards a structure for the content of their site. Everybody uses post-it notes. Putting it all up on a wall is key, so everyone involved can take in the whole site.
Usablity.gov identifies two types of card sorts, open and closed. Open where there are no categories defined, and closed where categories are defined and you are really sorting them into a structure. Card sorting: a definitive guide on Boxes and Arrows backs this up and provides a great overview of the benefits and disadvantages of card sorting.
Personally I like to think of open card sorting more as brainstorming and closed card sorting more as part of developing a site taxonomy or managing a redesign.
An open session is conducted in a highly participatory manner, I really want everyone in the room involved. I’ll give them all post its and they can write whatever they want on them. Bearing in mind they all understand this is about creating a content overview, we are not trying to develop functionality. Everyone then takes it in turn to place their post its on the wall. People will have used different words for the same category of content. So you begin to establish your sites naming conventions. Much like a tag cloud the bigger group of post it notes more important that category. So the sites content hierarchy begins to develop. After the first round the group can then edit the post its, and very quickly you have guided then to a consensus and created a coherent ‘mental model’ of the site. From this I like to produce the first drafts of site maps or wireframes.
A closed session, I think can be used to help define a very narrow set of categories and sub categories. There is more work up front, an audit has to be done of the existing content and transposed to cards or post its. The session should be very structured. All the cards on the wall every one working hard to revise the content structure. I find this works well with editors whose site have grown organically over the years and so the site has lost its structure. As a designer I would want to referee the sessions I would hope the business owner or editor would take ownership of the card sorting as its their content.