It sounds like you have a condition - the selected service type - and a number of actions that need to be taken based on its value.
On that basis you should try to break the code into manageable chunks where each chunk performs a particular set of actions (e.g. create a directory and its subdirectories) related to each of the conditions.
At it stands you have multiple chunks that relate around the actions, not around the conditions. For example you have a chunk of code that creates various top-level directories (dir_2, dir_3, dir_4, etc.). You then have a disconnected chunk of code that creates subdirectories within the top-level directory, but you've lost context (you no act based on which ServiceType was selected).
Instead, consider the following:
set ServiceType to {"ADV", "B2B", "PR", "PRO-BONO", "MEDIA"}
set selectedService to (choose from listServiceType)
-- here's what to do if 'ADV' is selected:
if (item 1 of selectedService = "ADV") then
set dir_2 to makenewfolderatdir_1with properties {name:ClientNumber & " " & ClientName & " " & ServiceType}
set sub1_2_1 to make new folder at dir_2 with properties {name:ClientName & " 2015"}
set sub2_2_1 to make new folder at sub1_2_1 with properties {name:ClientName & " 2015 Archive"}
set sub2_2_2 to make new folder at sub1_2_1 with properties {name:ClientName & " 2015 Art Assets"}
set sub3_2_1 to make new folder at sub2_2_2 with properties {name:ClientName & " 2015 Branding"}
end if
-- here's what to do if 'B2B' is selected:
if (item 1 of selectedService = "ADV") then
set dir_3 to makenewfolderatdir_1with properties {name:ClientNumber & " " & ClientName & " " & ServiceType}
set sub1_3_1 to make new folder at dir_3 with properties {name:ClientName & " 2015"}
set sub2_3_1 to make new folder at sub1_3_1 with properties {name:ClientName & " 2015 Archive"}
set sub2_3_2 to make new folder at sub1_3_1 with properties {name:ClientName & " 2015 Foo"}
set sub3_3_1 to make new folder at sub2_3_2 with properties {name:ClientName & " 2015 Other Stuff"}
end if
-- etc.
In this model you setup your variables (the ServiceType list and selection) and then run one of a number of chunks depending on what was selected. This makes it a lot easier to look at the code and predict what actions will be taken for each option in the list.