That approach makes sense on a small scale. Could be an administrative nightmare pending how many CADD staff you have accessing things. I'm guessing the focus is placed on the actual .dwg name itself as the main identifier? Could you share your file naming standards?
If everything is within 1 main folder for all your design work. That definitely has some advantages. This is likely taken from the view of a Civil 3D person. Problem is most firms let administration and IT drive the corporate folder structure. mmhmm
Actually, I think multiple working folders is more of a hassle with the more staff you have. The reason is that each machine has to be told where to look for the working folder for each project. Once it's set up, that machine should remember it every time a drawing is opened looking for that project. But you have to open a drawing from everyproject on everymachine before you know that everyone will get the data. Start off a new project, you have to go to every machine again to make sure they point correctly. Or just live with the fact that some people don't see or use the data shortcuts. (They'll still get the referenced objects in the drawing, it's only a problem if they go to create or reference new data. They may unknowingly end up creating shortcuts in a totally different project.)
With one Working Folder, you only have to point every machine once.
At least, that's my theory. We're in the process of switching over, still waiting to find problems.
When we make the move to 2013 we'll make a new working folder for those projects. Projects in the works in 2011 will be kept in 2011 (I think).
As for file names, we have a number for each client, and a -number for each project. So, say we are working on out 3rd job for client number 2585, the File structure would be
Q: PROJECTS / 2585 / 3 / CAD 2011 / 2585-3 Base.dwg etc. (pretty much all our drawings are in one directory. Exceptions for Archived etc)
The data is actually on a different network drive.
R: Civil 3D 2011 / Data Shortcuts Working Folder / 2585-3
Credit where credit is due! Give kudos or accept as solution whenever you can.