The concept of metadata in document libraries is often difficult to grasp for those new to SharePoint. Here is one example that helps.
Let’s say you create many documents about clients and their cases. To help with the organization of these documents, you create a folder for each client and a sub-folder for each case:
The first issue that arises is that each information worker has their own set of folders for the same clients. In the old days, this problem was solved using network shares. In this model, every user puts their documents into the same set of folders. Life is good. :)
However, in this scenario, only two pieces of information about the documents are available without opening them – the Client and Case number. What about the author? The person assigned to the case? The approval status of the document? These pieces of information are called metadata, and that is where the power of SharePoint Lists lies. Look at this list showing documents for Landers Farms:
I hope that this illustration of the power of metadata helps in your SharePoint deployment.