We present a new arrangement of directory bits called the segment directory to improve directory storage efficiency: a segment directory can point to several sharing processors with almost the same number of bits as the pointer which can point to only one. Many directory overflows can be eliminated by using the segment directory element in place of the pointer in the limited directory schemes. Also, the segment directory can be implemented without introducing additional hardware overhead and protocol complexity. The detailed execution-driven simulations show that the segment directory always does better than the pointer and eliminates many directory overflows by up to 85%. The resulting improvement in bandwidth and execution time is analyzed in detail for limited directory schemes having different behaviors, with respect to the reduced directory overflows.