Team president Dave St. Peter cited "philosophical differences" as the reason for making the change. Ryan was Minnesota's general manager from 1994-2007 before assuming the role of senior adviser to the general manager, a role he worked in until now.
"This is a culmination of multiple internal conversations between Bill Smith, Jim Pohlad and myself dating back several months," St. Peter said at a news conference announcing the change. "Over that time it became evident that there were philosophical differences in terms of the direction the club's baseball operations should be headed. In the past week, it was clear to all of us -- Bill, Jim and myself -- that a change in leadership was in the best interest of our organization."
Pohlad echoed St. Peter's statements about the difference in philosophy, but he would not get into specific details, other than stating that the move was not based on public reaction to the club's 99-loss season.
"We have high expectations all the time," Pohlad said. "We're not reacting to fan reaction. We're not trying to be cryptic about what happened here. There's no smoking gun. There was simply a difference in philosophy."
St. Peter added Smith has been offered a new role in the organization, and is expected to make a decision on his future in the next month. Ryan said he'd love to keep Smith on his staff, which also includes top assistants Mike Radlcliff and Rob Antony. The Twins are also expected to hire former Reds general manager and Minnesota assistant GM Wayne Krivsky as a professional scout and assistant to the general manager later this week.
"I hope Billy considers coming back in a job description that Dave, Jim and myself laid out with some of the things he enjoys that are right up his alley," Ryan said.
Smith, 53, began his career in the Twins organization in 1986 and was named the fifth general manager in Minnesota's history on Sept. 13, 2007.
The Twins won two American League Central titles (2009-10) under Smith and narrowly missed another chance at the postseason when they lost in a dramatic Game 163 to the White Sox in '08. But the club never won a postseason game during his tenure, and finished with the worst record in the AL last season.
Before taking over as GM, he spent 13 seasons as vice president and assistant general manager, sharing responsibilities for negotiating contracts, assisting the day-to-day operations of the Major League department and the Twins' academies in Venezuela and the Dominican Republic.
Smith's first role with the Twins came in '86 as assistant director of Minor Leagues and scouting. He was later named director of baseball administration for Minnesota in October 1989, and was the Twins' liaison during the construction of their Spring Training home in Fort Myers, Fla., from 1989-91.
"Working for the Minnesota Twins for the past 26 seasons has been the greatest professional privilege I could have ever imagined," Smith said in a statement. "I will be forever grateful to the Pohlad family for the many wonderful opportunities they have provided to me, including the chance to sit in the general manager's chair for the past four seasons. My thanks and admiration to each of the wonderfully talented people with whom I have worked, and to Tom Kelly, Ron Gardenhire, their hard-working coaches and trainers and a large group of players who always represent the Minnesota Twins on the field and in the community better than any team in baseball! Finally, it gives me great pleasure to hand this baton back to the best baseball man I have ever known, Terry Ryan."
Ryan has spent more than 28 years in the Twins organization as a Minor League player or executive. As a result, Ryan, 58, said he's fully plugged into the organization and knows what needs to be fixed moving forward.
"I'm certainly up to speed about everything that's going on in the baseball department," Ryan said. "I was a piece of the organizational meetings and the conference calls and all the things that Bill put together. Actually, the last four years I've been out scouting more than I've been at the Major League games, but I'm up to speed on what's going on with the roster.
"We've got a lot of work to do over the next month, certainly. GM meetings are coming up, free agency is upon us already, 40-man roster and the Winter Meetings, arbitration -- all the stuff that comes with the offseason. But I think we have people intact here that we can get this thing going back the way it was prior to the 2011 season."
As interim general manager, Ryan will be responsible for the team the Twins put on the field (40-man and 25-man Major League rosters), negotiating contracts, overseeing the coaching staff and entire baseball department, including the Minor Leagues, scouting, the medical staff, team travel and baseball communications.
Ryan will also be responsible for helping find a replacement general manager, as he said he's not sure if he'll be GM for one year or 10 years.
"It could be a short amount of time or it could be a long time," Ryan said. "Nothing has really changed. I would say that maybe I recharged my battery some. I'm going to take this job head on. I'm not going to do it part time. It's a challenge. Being a general manager is a 365 days out of the year job. That's the way I'm going to go at it."
Ryan was named the fourth GM in Twins history on Sept. 13, 1994. Through the efforts of Ryan and his staff, Minnesota won four AL Central titles (2002-04 and '06).
He was twice named Sporting News Executive of the Year ('02 and '06) and was twice the recipient of the Andrew "Rube" Foster Legacy Award as the AL Executive of the Year by the Negro Leagues ('04 and '06). Under Ryan's leadership, the Twins were twice named Baseball America's Organization of the Year ('02 and '04).
But now in his second go-round as GM, Ryan has the luxury of having a much higher payroll to work with as a result of the club moving from the Metrodome to Target Field in 2010.
Ryan's largest payroll while GM of the Twins was $71 million in '07, and said he anticipates the payroll to about $100 million this year, which is actually a drop-off of last year's Opening Day payroll of $113 million.
"Whatever it is, it's going to be a heck of a lot more than I've ever worked with," Ryan said. "I don't believe payroll has to be a major factor for success. But it doesn't hurt."