team site in office 365

Dear Experts

We recently migrated to office 365 premium and all the department heads  are provided with office 365 premium accounts, every department head has a team of 5 to 10 users reporting to them, now I am planning to centralized the documents storage of all the users reporting to the department head to store every piece of document in the team site and entire team has access for the document storing and collaboration.
It also happens cross department users can have access to other department team sites , any changes and updates done like even additional of document or modification their to be email auto notification to the team members, also wanted create folders and provide access to the vendors to upload their documents but access control to be set that they can only access their provided folder and perform upload/modify and edit.
please suggest me is this a best practice as at present data are in users machine and it has become their discretion to share or not and only if asked they will share and that to back and forth mail attachments putting us confusion.
Can I create department wise team site and provide the access please suggest, also how to create the team site please provide me the steps . Thanks in advance.
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Vasil Michev (MVP)Commented:
Creating a proper SharePoint structure is something you should decide on together with the business owners/departmental leads in your organization. There are many different options: creating individual Site collections per department, creating Team sites, even using the new, group-based sites. There are many articles on the internet that discuss this subject, here's one that you can use as starting point:

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Colleen Kayter4D AssetsCommented:
Vasil is right. You've got to plan your SharePoint structure with management. Ideally, the structure will be similar to your org chart, with departments having separate team sites. And since you have some people who have cross-department job functions, I'm guessing that project sites might also be useful for you.

You mention that department heads have premium accounts? I'm not sure what that means. All your employees need to have Office 365 accounts. If you're saying that only department heads have desktop apps included with their accounts, that doesn't make sense either. Whether or not desktop apps are included with a user's account should be based on their job function. Dept. heads should definitely have desktop apps, but so should anyone else whose job includes working extensively with Word, Excel, or PowerPoint.

One thing to keep in mind when you're mapping out your SharePoint structure: as time goes by, more and more documents will be stored there, users will continue to give documents cryptic names, and things will get harder and harder to find. Yes, you can create subsites and folders to organize, but when users create a new folder or subsite, permissions are inherited from the parent folder unless they stipulate otherwise.

e.g., It will be much easier if the marketing dept. has a team site, with project sites for various products/marketing campaigns/whatever and the accounting dept. to have a completely separate team site, with folders or subsites that allow vendor access. The sales dept. might have a team site with individual folders for each client (if your company is a B2B), or better yet, subsites for each client with client contacts having access to some folders. Use groups to assign permissions and add/remove employees to the groups, not the individual sites.

The bottom line? Go granular. It will be much easier to organize documents, limit sharing, and maintain security.
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