When you need a piece of sheet material of a particular size, you take a piece from your store that is large enough, and you cut the first dimension (on your MFT, naturally). Then you cut the second dimension. This means that most of the time you have two pieces to put back into stock for the one you take out. This, for me, is why I was getting more and more pieces cluttering up my workshop. The natural state of using sheet material is that you will accumulate more and more, smaller and smaller pieces. Random requirements are never enough to use up all these small bits. You don’t need to keep them all.
I ran some computer simulations to work out the optimum number of pieces to keep. The remarkable result was that if you ruthlessly only keep the four largest pieces of each material thickness, the total amount you use is only about 20% higher than if you keep every single piece. For me, it’s worth a 20% increase in costs of material to keep my workshop tidy. e.g. I start with a 2400x1200mm sheet of 18mm ply and cut it into four (I never usually need anything larger). From them on, I only ever keep four pieces until I buy the next sheet.
My own suggestion was oriented towards boards:
Decide on the smallest piece of wood you would want to use (say a block in an end-grain cutting board) — everything gets cut and sorted by lengths which match up with that + saw kerf in suitable increments — arrange in suitable stacks by those lengths — any stack which exceeds a certain height sort through and cull/cut up the least desirable pieces. The stack of the smallest pieces should be sized to make a project — when it gets too tall, make one or more.