The problem with del.icio.us is that its search isn’t very good. Tags can be good way of organizing and finding information, but you need a good search. That said, have a look at Simpy, as it has a number of advantages over del.icio.us.
For example, read this: http://blog.simpy.com/blojsom/blog/2005/08/15/Why_Simpy_over_del_icio_us.html
As for how you can make good use of tags, see:
http://blog.simpy.com/blojsom/blog/2005/09/28/Quick-Study-Tag-Use-Patterns.html
http://blog.simpy.com/blojsom/blog/2005/08/11/Categories_vs_Keywords_vs_Labels_vs_Tags.html
and other entries in that blog.