SharePoint document management best practices for a small team

Keep documents in a few topic libraries, label them with columns instead of deep folders, and turn on versioning. Then give edit rights to the few people who need them.

Should a small team use folders or columns?

Use both, but lean on columns. Microsoft says folders are a physical construct with limited flexibility. Folder trees nested more than one or two levels deep make files hard to find, and Microsoft says to avoid them.

Columns and content types are what Microsoft calls the two most important metadata elements for organizing documents. They let people filter and sort a library, and they help search. A column such as Client, Status or Year does the job of three folder levels.

How many libraries should you have?

Every site comes with one Documents library, but you are not limited to one. Microsoft suggests adding topic-specific libraries instead of putting everything in the default one.

Small-team advice: start with one library per kind of work, such as Contracts, Policies and Project Files. If two groups of files need different people to see them, give them separate libraries.

How do you turn on versioning?

In Microsoft 365, versioning is on by default for new libraries and lists. Microsoft says it saves the last 500 versions of a document. When a limit is reached, the oldest versions are deleted automatically.

Menu names can differ between tenants, so match them to your own screen. The Versioning settings page offers these options: require content approval, create major versions only or major and minor versions, limit the number of versions and drafts kept, choose who sees drafts, and require check out before editing.

Open the library.
Select the Settings gear, then Library Settings.
Select Versioning settings.
Choose your options and select OK.

What are major and minor versions?

A major version has a whole number, such as 5.0, and usually marks a milestone like a file ready for review. A minor version has a decimal, such as 5.1, and usually means work in progress. Libraries can track both. Lists track major versions only.

Small-team advice: major versions only is simpler. Add minor versions when you want drafts hidden until a file is ready. For a sign-off step, see our guide on document approval in SharePoint.

When should you require check out?

Require check out is one of the library versioning options. It makes people check a file out before they edit it.

Small-team advice: leave it off for Office files that several people edit together. Turn it on for files where a clash would do harm, such as a signed contract template.

Who should be able to edit?

Read, Edit and Full Control are the permission levels you pick when you share a site. Read is the default.

Small-team advice: most people only need Read. Give Edit to the people who maintain the files, and keep Full Control to one or two owners. If your team also chats in Microsoft Teams, our Teams vs SharePoint guide explains where each one stores files.

What else should you plan before you start?

Pick one owner for each library. Write down the column names. Decide where a file goes before anyone uploads it.

If you are weighing SharePoint against another tool, read SharePoint vs Google Drive. If your lists collect files as attachments, read where SharePoint list attachments go.

Need help setting this up?

I am Al Davies at 250 High Street LLC. I build SharePoint and Power Automate trackers for small teams, remotely. The first call is free. You can see past work in the portfolio.

FAQ

Are folders bad in SharePoint?

No. Microsoft says they can help manage performance and security. Avoid nesting more than one or two levels.

How many versions does SharePoint keep?

In Microsoft 365, Microsoft says it saves the last 500 versions of a document by default. The oldest are deleted when a limit is reached.

Can a site have more than one document library?

Yes. A site starts with one Documents library, and you can add more.