by Scott Jack
Content Contributor, E-N Computers
More than a decade of experience in technical support including end user support, mobile device management, application deployment, and documentation.
When John came on as a new partner at his law firm, he found that all of the firm’s documents were in the other partner’s OneDrive. He was one personnel change away from a data crisis — and swift action was necessary to protect the business.
This is a surprisingly common scenario. OneDrive for Business is included with every Microsoft 365 subscription, so businesses often default to it without much thought. For individual file storage, it works well. But when teams start using it as a shared file system, things get complicated fast.
E-N Computers is a Microsoft partner and a managed IT services provider serving businesses in Virginia and Washington, DC. We work with OneDrive every day — deploying it, troubleshooting it, and helping clients use it in a way that actually makes sense for how their business runs. This article covers what OneDrive does well, where it falls short, and the practical steps you can take to avoid the most common headaches.
QUICK ANSWER:
What’s the best way to use OneDrive?
OneDrive for Business works best for individual file storage, while SharePoint is best for team files. Common problems include sync performance degrading past 300,000 items, file path length limits, endless “processing changes” states, and co-authoring conflicts on non-Office files.
To use OneDrive successfully: store shared files in SharePoint, audit external sharing, keep folder structures shallow, update your offboarding process, and add a cloud-to-cloud backup since OneDrive syncs files rather than backing them up.
What OneDrive is — and isn’t
OneDrive is a cloud storage service from Microsoft with desktop and mobile applications. The desktop app syncs files between your computer and the cloud and can also sync SharePoint document libraries. The mobile app lets you browse and access your files from anywhere.
OneDrive is for syncing, NOT backups. Whatever happens to your files on your computer — including ransomware encryption — will be reflected in the cloud within minutes. A true backup lets you go back in time to a clean, isolated copy of your data. OneDrive does maintain version history, but that’s not the same thing.
OneDrive is for personal work files, while SharePoint is for shared team files. They look similar, and the desktop app syncs both, which makes them easy to confuse. But they serve different purposes and mixing them up will add to your pain.
Common problems with OneDrive for Business
We’ll highlight a few problems with OneDrive that commonly trip people up. These problems can waste the time of your team as they wait on files to sync or troubleshoot sync issues.
Sync performance degrades after 300,000 files.Microsoft specifies a limit of 300,000 items across your OneDrive and any synced SharePoint libraries. Past that threshold, sync performance degrades noticeably. For most SMBs this isn’t an immediate concern, but it can be if you’ve been accumulating files for years across multiple libraries.
File path length is limited to 255 characters. OneDrive technically supports paths up to 400 characters, but Windows caps out at 255. Your file path includes everything from the drive letter to the file name, and OneDrive automatically inserts your company name into that path:
C:\Users\YOURNAME\OneDrive - E-N Computers\Documents\...
That example is 20% of the allowed length. Deeply nested folder structures and long file names eat into that budget quickly. When the limit is exceeded, files simply won’t sync — and users may not immediately understand why.
“Processing changes” never ends. When you move, upload, or delete a large number of files at once, OneDrive can get stuck in a “processing changes” state that seems endless. This isn’t a bug exactly, because Microsoft limits sync rate to maintain service quality. But it kills productivity. Sometimes the only fix is to reset the sync client entirely.
Co-authoring conflicts for non-Office files are common. When two people edit a native Office file (Word, Excel, PowerPoint) at the same time, Microsoft handles the conflict automatically. For other file types, OneDrive creates a duplicate with the computer name appended, cluttering up folders and creating confusion about which version is current. If your team collaborates on non-Office files, this will become a constant frustration.
Microsoft has a comprehensive list of restrictions and limitations in OneDrive and SharePoint.
How to use OneDrive successfully
Most of these problems are avoidable with the right setup and a few clear policies.
Separate personal files from team files. This is the most important habit to build. Think of it this way: OneDrive is for me; SharePoint is for us.
If you’re the only one who needs a file, it can live in OneDrive — this might bea personal reference document, a draft you’re still working on. But if more than one person regularly needs access, it belongs in SharePoint. Had John’s firm followed this rule, their documents would have been safe regardless of any partner transition. Files in SharePoint are tied to the organization, not to any individual’s account.
Use Request Files for secure client document collection. With Request Files, you can create a link for clients to upload sensitive documents directly to a secure folder in SharePoint. This bypasses the file size limitations and security risks of using email. Clients can only upload to the folder, not view it. Some clients drop their Sharefile subscription once they realize this feature exists in Microsoft 365.
Audit your external sharing. External sharing is turned on by default in most Microsoft 365 tenants, which means files and folders can be shared with anyone who has the link. That’s convenient, but it’s also a common source of unintended data exposure.
Conducting a periodic audit of what’s been shared externally, and with whom, is a step most businesses skip. A good practice is to use a dedicated SharePoint library specifically for external sharing, which makes it easier to monitor and control what’s going out.
Keep your folder structure shallow. Try to limit your folder structure to no more than three layers deep. This will help keep the file path length under control and make it easier to find files. If you’re migrating away from a legacy file server, it’s a good time to simplify.
Build OneDrive into your offboarding process. When an employee leaves, their OneDrive doesn’t disappear immediately, but the window to act is short. You have 30 days to recover or move their files before they’re gone. (Note: this window can be extended in the Microsoft 365 admin center, and the exact duration may vary by license.)
A simple offboarding checklist should include granting a manager access to the departing employee’s OneDrive to move any needed files into SharePoint before the account is deactivated. This is a five-minute task that prevents serious data loss when someone walks out the door.
Use a cloud-to-cloud backup. Because OneDrive syncs rather than backs up, a ransomware attack or accidental mass deletion can propagate through your entire file structure before anyone notices. A third-party cloud-to-cloud backup solution creates an independent copy of your Microsoft 365 data that isn’t affected by what happens in your tenant.
This costs just a few dollars per user per month. For businesses handling sensitive data, it’s a necessity.
Know when to use a different tool. OneDrive and SharePoint are excellent for most business file storage needs, but there are scenarios where a more specialized tool makes more sense. If your team works with large files prone to versioning conflicts — like CAD drawings and multimedia — or if you’re subject to strict compliance requirements, it’s worth evaluating purpose-built alternatives.
When another tool makes more sense
If OneDrive isn’t the right fit, here are tools we recommend, depending on the industry. These serve a specific purpose and are often used along with OneDrive and SharePoint.
Engineering and construction firms working with Revit or AutoCAD files are often better served by Autodesk Construction Cloud, which is purpose-built to handle those large, complex files and prevent version conflicts. An Azure virtual file server is another option: it behaves like a traditional on-premises file server but runs on Microsoft’s infrastructure.
Legal and financial services firms often have document management needs tied directly to compliance requirements. Case management platforms like Clio attach documents to specific matters, which is far more useful than a generic folder structure. Investment advisors affiliated with a broker-dealer typically use that firm’s document management system for anything subject to FINRA oversight.
In most cases, these tools work alongside OneDrive and SharePoint rather than replacing them entirely.
Make sure your IT is working for you
OneDrive isn’t a bad tool, but it is a widely misused one. The businesses that get the most out of it understand what it’s for, have clear policies about where files belong, and don’t rely on it as a backup.
When you have the right people working together, you can implement systems and processes that actively help you reach your business goals. We sometimes call this IT maturity. But for many organizations, something is off when it comes to their partnerships, strategy, systems, and settings. How can you know what’s working well and where you have room for improvement? Start by taking our free IT Maturity Self-Assessment. You’ll walk away with some pointers and, if you want, a free appointment to discuss your results.
Not sure if you need managed IT services?
Take the IT Maturity Self-Assessment
In a few minutes, get actionable insights on your IT strategy, plus a free strategic consultation.
