The Twins finished last in the American League Central with a 63-99 record. It was the first time they finished last since 2000 and was their worst record since they were 56-88 in 1995, a season that was shortened by labor problems.
Smith took over from Ryan in September 2007, after Ryan had led them to four division titles in his 13 years. Under Smith, the Twins won the division in 2009 and 2010 after losing to the Chicago White Sox in a one-game playoff for the division title in 2008.
"No one in the Twins' organization wants to win any more than Bill," Twins owner and CEO Jim Pohlad said in a statement.
"He is unquestionably loyal, committed and talented. The Twins' goal is to get better in 2012 and beyond. Bill was equally motivated to achieve that goal, but we differed in the scope and approach that was required. Going forward, we intend to have additional discussions with Bill about an ongoing role within the organization. We wish Bill, Becky and the entire Smith family nothing but the best."
Pohlad added, "We are fortunate and grateful for Terry Ryan's willingness to step in as interim general manager."
Ryan, who has been in the organization for 28 years as a player and executive, will handle the team's offseason moves and also will help find a replacement.
Smith has been with the team since 1986.
--Between trades and free agency, the Twins have shed $45.5 million in 2011 payroll, and if they stick within the neighborhood of last season's Opening Day payroll of $113.2 million, they have about $34 million to play with in free agency.
That's pretty good money, but also consider that Minnesota has many holes to fill. They're on the verge of losing two closers plus a starting first baseman, right fielder and designated hitter to free agency. If that isn't a tall enough task for interim general manager Terry Ryan and his staff, they need to fix a leaky bullpen and upgrade at shortstop and backup catcher.
When the five-day deadline for teams to bargain exclusively with their own free agents ended, longtime Twins Joe Nathan, Michael Cuddyer and Jason Kubel were free, for the first time, to sell their wares to any of the major league's 30 teams. Also available to the highest bidder is Matt Capps, a top-notch closer for the Twins in 2010 who fell on hard times last season.
When one adds Jim Thome and Delmon Young, traded in waiver-wire deals as the season wound down, the Twins have shaved nearly $46 million from a payroll that ballooned to about $118 million as the team dealt with a league-high 27 trips to the disabled list. By season's end, all but a few players on the 40-man roster had been with the big-league club.
The Twins first need to get healthy. At one time or another, they had 16 players to the disabled list, including stints longer than 40 days by Kubel, Joe Mauer and Tsuyoshi Nishioka. The implication here is that injuries were the biggest factor in a 99-loss season, which might, in fact, be true. But it's also true that the Twins have personnel issues.
They need to re-sign Cuddyer and Kubel or find another corner outfielder and DH. If they don't re-sign Nathan -- whom they just bought out of a $12.5 million option for $2 million -- they'll need a closer. They also need a starting shortstop and a backup catcher.