TL;DR: Without governance, Microsoft Teams becomes ungovernable within 6–12 months: dozens of teams with overlapping purposes, thousands of channels no one monitors, files in random locations, and guest access to ex-clients and former suppliers. This guide gives you a practical governance framework you can implement in a day.
The Teams Governance Problem
Microsoft Teams is the fastest-adopted enterprise application in history. It is also the one that creates the most organisational chaos when deployed without planning.
The problem is Teams’ open creation model: by default, any user can create a new Team at any time. They can add channels, invite guests, and upload files - all without IT approval or governance. After 12 months of this, a typical Microsoft 365 environment has:
- Dozens of Teams with unclear purposes and overlapping content
- Channels that were created for a project that ended 18 months ago
- Files spread across Teams, SharePoint, OneDrive, and email attachments with no clear organisation
- Guest accounts for clients, suppliers, and contractors who left the engagement years ago
- No one sure which Teams are still active
None of this is the users’ fault. Teams made it easy to create. Governance would have made it manageable.
Part 1: Team Structure Design
The Two Types of Teams
Before creating any governance rules, distinguish between the two fundamentally different purposes Teams serves in most organisations:
Persistent, standing Teams: These represent ongoing organisational structures - departments, business units, or long-term project groups. Examples: Sales Team, Finance Team, Leadership, HR. These teams should be created by IT, following naming conventions, with clear ownership.
Project or time-limited Teams: These are created for specific projects, campaigns, or engagements with defined end dates. Examples: Client X Engagement, Office Move Project, Website Redesign. These teams have a lifecycle - they should be archived when the project ends.
Understanding this distinction shapes your entire governance approach.
Recommended Team Structure for SMBs
For a typical professional services business with 20–100 staff, the following team structure covers most needs:
Tier 1 - Company-wide Teams:
- Company Wide - announcements, company news, all-hands content. Channels: General, Announcements, Social.
- IT Support - internal IT requests and announcements. Channels: General, IT Requests.
Tier 2 - Department Teams:
One Team per department. Naming convention: Department Name (e.g., “Finance”, “Marketing”, “Operations”)
- Channels: General (always present), plus relevant topic channels for the department.
Tier 3 - Client/Project Teams:
One Team per active client engagement or project. Naming convention: CLIENT-ProjectName (e.g., “ACME-WebsiteProject”)
- Channels: General, Documents, Questions.
- Guest access: add client contacts as guests to their own client Team - not to department Teams.
Tier 4 - Cross-functional Teams:
For specific working groups that cross department lines. Naming convention: WG-TopicName (e.g., “WG-CyberSecurity”, “WG-OfficeMove”)
Naming Conventions
Consistent naming makes Teams navigable. A user can find what they need without scrolling through a random list. Recommended conventions:
- Departments:
Finance,Operations,Marketing- simple department name only - Client Teams:
CLIENT-EngagementName- prefix makes client Teams group together alphabetically - Working Groups:
WG-Topic- prefix identifies working groups - Archived Teams:
ARCHIVE-OriginalName- archived Teams stay visible but clearly marked
Part 2: Channel Structure
Default Channels
Every Team has a “General” channel that cannot be deleted. Do not clutter the General channel with everything - it loses its purpose as a general discussion space.
Recommended channel structure for most Teams:
- General - open discussion, questions, general communication
- Announcements - important updates (pin this and restrict posting to Owners if appropriate)
- Files (this is SharePoint behind the scenes) - managed file storage
For department Teams, add topic-specific channels relevant to the department’s work. Keep the total number of channels manageable - if a Team has more than 10 channels, review whether some should be archived or merged.
Channel Moderation
For channels where only specific people should post (announcements, important notices), enable channel moderation:
- Go to the channel > Manage Channel
- Turn on Channel Moderation
- Add Moderators - only Moderators can post, others can reply
This prevents announcement channels from becoming general chatter.
Part 3: Governance Controls
Restrict Team Creation
By default, any Microsoft 365 user can create a new Team. For organisations that want controlled governance, restrict this to IT administrators or a defined set of users.
How to restrict Team creation:
- In the Microsoft Entra admin centre (entra.microsoft.com), navigate to Groups > General
- Under “Restrict who can create Microsoft 365 groups” - toggle to “Yes” and select the security group containing approved creators
Note: This restricts Microsoft 365 Group creation, which controls Team creation. Ensure the group you create for “approved creators” includes IT admins and any managers who legitimately create Teams.
Guest Access Policy
Guest access allows external users (clients, suppliers, contractors) to be added to Teams. It is useful but needs governance.
Recommended guest access settings (Teams admin centre > Org-wide settings > Guest access):
| Setting | Recommended Value |
|---|---|
| Allow guest access | On |
| Make private calls | Off |
| IP video | Off (guest meetings should use PSTN or screen share only) |
| Meet now | Off |
| Edit sent messages | Off |
| Delete sent messages | Off |
| Chat | On |
| Use Giphy | Off |
| Use memes | Off |
Guest lifecycle: Review guest accounts quarterly. Remove guests who are no longer active on an engagement. In the Entra admin centre, review “Guest users” and identify any who have not signed in for 90+ days.
Part 4: Teams Lifecycle Management
When to Archive a Team
Teams should be archived when the project or engagement they support is complete. Archiving makes the Team read-only - content is preserved but no new messages or files can be added.
Triggers for archiving:
- Project is marked complete
- Client engagement ends
- Working group disbands
- Department restructure makes a Team obsolete
How to archive a Team:
- Go to Teams admin centre (admin.teams.microsoft.com)
- Manage Teams > select the Team > Archive
- Teams channel is marked as archived and becomes read-only
Users can still browse archived Teams and access old files and messages - they just cannot add new content.
Team Ownership Requirements
Every Team must have at least two Owners. An Owner can add and remove members, change team settings, and archive the Team when it is no longer needed. Single-owner Teams are a governance risk - if the owner leaves the business, no one can manage the Team.
Audit Team owners regularly:
- In Teams admin centre > Manage Teams, review the Owners column for each Team
- Identify Teams with only one Owner
- Contact the Owner and ask them to designate a second Owner
Expiration Policies
Microsoft 365 Groups (which underpin Teams) can be configured with expiration policies - the Group (and its Team) is automatically deleted if no activity occurs within a set period, unless the Owner confirms the Team should continue.
How to enable expiration policies:
- In Entra admin centre > Groups > Expiration
- Set Group lifetime (90 days is common for most active organisations)
- Choose whether to include or exclude specific groups
Warning: Test expiration policies in a limited pilot before enabling organisation-wide. Automatically deleted Teams and their associated SharePoint sites can be recovered within 30 days, but recovery requires IT intervention.
Part 5: Files and SharePoint Integration
Teams stores files in SharePoint behind the scenes. Understanding this relationship is key to governance.
Every Team has an associated SharePoint site. Files uploaded in Teams channels are stored in the corresponding SharePoint document library. This means:
- Files are accessible from both Teams and SharePoint - same files, two views
- SharePoint permissions flow from Team membership by default
- Large files and formal document management should be managed via SharePoint - Teams is for working documents
Avoid the common mistake: Staff often use the “Files” tab in Teams as their primary file storage for everything - large, final documents, client deliverables, financial records. These should be stored in the associated SharePoint site with proper metadata and version control, not just as files in a Teams channel.
See Microsoft 365 Hidden Features Guide for SharePoint best practices.
Implementing Governance: A Practical Sequence
Week 1: Audit current state - export a list of all Teams, their owners, last activity, and member count. This is sobering but necessary.
Week 2: Design target state - define your naming convention, team structure template, and governance rules.
Week 3: Communicate and train - brief team owners on the new conventions and the expectation that they manage their Teams according to the governance framework.
Week 4: Clean up - archive stale Teams, fix naming convention violations, ensure every Team has two owners.
Ongoing: Monthly governance review - new Teams created that week, guest accounts, Teams approaching archival.
For help implementing Teams governance as part of your Microsoft 365 management, book a Right Fit Call with CX IT Services.
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