SharePoint, OneDrive or Teams: where should each file live?

The one question that sorts most files

Ask who would need this file if the person who made it left tomorrow. If the honest answer is nobody, it is personal working material and OneDrive is the right place: a half-written proposal, your own notes, a spreadsheet you are testing an idea in. If the answer is the office manager, the next accountant or whoever picks up the client, it belongs to the business and should sit in a shared library from the start, not be moved there later when someone remembers.

This matters more than it sounds. When a staff member leaves, their OneDrive is cleaned up after a set period. Anything the business relied on that only lived there has to be found and moved in a hurry, usually by someone who does not know which of four versions of the price list is current. Deciding ownership at the point of saving avoids that scramble entirely.

What OneDrive is good at, and where it goes wrong

OneDrive is a personal storage area tied to one person's Microsoft 365 account. It syncs to their laptop, follows them to their phone and lets them share a single file with a colleague or client when they choose to. It is ideal for drafts, personal reference material and the Desktop and Documents folders that would otherwise sit unprotected on one computer.

It goes wrong when a team starts running shared work out of one person's OneDrive by sharing a folder with everyone. It works for a while, then that person goes on leave, changes role or resigns, and the access everyone depended on is tied to an account that is about to be removed. If more than two people regularly edit something, it has outgrown OneDrive.

What SharePoint is for

SharePoint is where the organisation keeps its files. Each SharePoint site has one or more document libraries, and access is granted to groups rather than to individual files, so a new starter in accounts gets the finance library on day one without anyone hunting through folders to share. When someone leaves, the files stay exactly where they were.

A small office typically needs only a handful of sites: one for company-wide documents such as policies and templates, one for finance and HR with tighter access, and one per major function or client group. A building company might have a site for estimating and another for project files; a medical practice might separate clinical admin from practice management. Keep the number small enough that everyone knows where to look.

How Teams fits in

Every team created in Microsoft Teams quietly creates a SharePoint site behind it, and each standard channel gets its own folder in that site's library. The Files tab in a channel is just a window onto that folder. So a file saved in Teams is a SharePoint file, with the same version history, permissions and recycle bin.

Use the Teams view when a group works on files together in conversation: a project team, a tender response, an event. Use SharePoint directly for the long-lived reference library that people open from File Explorer or a browser. Problems start when an office creates a new team for every small topic, because each one spawns another site and another library, and nobody can find anything after six months.

Attachments in chat are not filing

When someone drops a file into a one-to-one Teams chat, it is uploaded to the sender's OneDrive and shared with the people in that chat. When they drop it into a channel, it lands in the channel folder. Staff rarely notice the difference, which is how important documents end up scattered across personal storage areas without anyone deciding that.

A simple house rule helps: chats are for talking, and anything worth keeping gets saved to the right library first and then linked, not attached. The same applies to email. Sending a link to the SharePoint copy means everyone edits one file, the latest version is always the one they open, and you are not storing twelve copies of the same contract in twelve mailboxes.

Writing it down for your office

Put the rules on a single page and keep it short: what goes in OneDrive, the list of SharePoint sites and what each is for, and when to create a new team. Add two or three real examples from your own business, such as where signed client agreements go or where the monthly payroll export is kept. Then go through it with staff in a ten-minute slot at a team meeting rather than sending it by email.

Review the page every six months. Libraries drift, new teams appear and someone always finds a creative place to save the insurance renewal. A quick look at which sites and teams have been created recently, and whether they are still used, keeps the structure from sprawling. If you want a second opinion on your current layout, an Office IT health check covers where your files actually live and who can open them.