Xerox first used the term “folder” to describe computer directories in 1958, and that metaphor has stuck ever since.  The appeal is obvious: people like thinking about data in physical terms, and picturing files as digital papers inside a flap of digital cardboard is a simple, concrete image. 

So if everyone likes folders so much, why would we tell organizations not to use them in SharePoint libraries?  

There are a few reasons, namely:

  • Folders only provide one system for grouping documents, which might not make sense to everyone.  Some people might want to browse a set of reports by subsidiary or account while others might want to browse the same reports by year.  But a folder structure forces you to choose one primary way of organizing files: it’s either year, then subsidiary, or vice versa.  And it’s all too easy for important files to get lost in a confusing maze of sub-sub-subfolders.

  • Folders lead to duplication and fragmentation.  If there’s a single form that both your Finance and HR team use, chances are good that each team will keep their own, separate copy in their respective corners of the file system.  And this can lead to version control nightmares if that form ever needs to be updated.

  • Folders don’t help with search unless you tag the folders themselves with metadata. 

But even if we accept that folders aren’t great for every situation, what’s the alternative?  Well, in most cases that would be keeping all your files in a single location, then tagging them with metadata. 

  •  For instance, if you had annual reports for each subsidiary, you could tag them by “Subsidiary” and “Year” then let people filter by one or the other according to their needs.

  • Similarly, if you had a form used by both HR and Finance, you could have one copy in your library and tag it for both departments, greatly reducing the risk of duplication / fragmentation.

  • Metadata tagging also allows you to create customized views for quick reference.  For example, if you had slightly different HR forms for each country your organization operates in, you could display a filtered list for each country on their respective intranet sites.

Yet, despite the advantages of metadata tags, over two-thirds of users express a preference for folders.  Why?  

Familiarity is one reason.  Metadata tagging requires people to think in the abstract about the many different ways files might be categorized, versus the more comfortable, tangible “we keep these files in this folder…” metaphor.

The other reason is time.  While metadata tagging, done right, helps people find files faster, tagging them in the first place requires more thought and effort than dumping files into a folder.  For that reason, we encourage organizations to keep important files such as official reports and policies in a central, tagged library, while allowing people to keep their day-to-day working documents in personal or team libraries with folders and subfolders.

Finally, note that, by “metadata tagging” we mean a library with a fixed number of predefined metadata columns, each with a limited number of predefined tags.  We are not talking about free-form tagging like you see in social media hashtags – while hashtags have their place, they’re not great for keeping things organized and consistent.