Smith was dismissed Monday, when the Twins returned Terry Ryan to the role on an interim basis. Smith was Ryan's top assistant when Ryan stepped down in 2007, citing burnout, after holding the job for 13 years.
Widely recognized for their stability, class and ability to make the most out of a medium-range payroll, this was a startling move for the Twins despite the embarrassment and deep disappointment of the 2011 season following two straight AL Central titles.
This is the first time since the franchise moved from Washington to Minnesota in 1961 the Twins have fired a general manager. Calvin Griffith was the owner and general manager until selling the team in 1984. Andy MacPhail became the fulltime successor, leaving for a prime job with the Chicago Cubs, and Ryan followed him.
Ryan's moves helped turn the Twins from one of the worst teams in baseball in the mid-90s to one of the best the next decade. They won four division titles over Ryan's last five full seasons, without spending much money in free agency and instead drafting and developing their core players.
Shrewd trades were part of his success, too, fetching Cristian Guzman and Eric Milton for Chuck Knoblauch; getting Nick Punto and Carlos Silva for Milton; and landing Francisco Liriano and Joe Nathan for A.J. Pierzynski.
Smith's decisions haven't turned out as well, dealing Johan Santana, Matt Garza, J.J. Hardy and Delmon Young for little production in return. Japanese shortstop Tsuyoshi Nishioka, the headliner acquisition last winter, was hurt for much of the season and a bust at the plate and in the field.
"No one in the Twins' organization wants to win any more than Bill," Twins owner 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."
Pohlad added that the Twins will speak with Smith about "an ongoing role within the organization." Smith has been with the club since 1986.
The Twins were division champions under his watch in 2009 and 2010, with Ryan, assistant general manager Rob Antony and vice president of player personnel Mike Radcliff also serving as key officials around Smith.
But this season was a mess.
Injuries to Jason Kubel, Joe Mauer, Justin Morneau, Nishioka and other key players didn't help, but the most expensive team in Twins history — with an opening-day payroll of more than $112 million — prompted Pohlad and the rest of the front office to take a hard look at an organization that has frequently been lauded as one of the finest in the game. The top of the farm system has dried up in recent years, and the rebuilding project will be a challenge for Ryan and the rest of his support staff.
Smith acknowledged when he was hired his strengths lied in administration and operations. He didn't play the game or scout it like Ryan did. He worked heavily with the team's development academies in Venezuela and the Dominican Republic, and he played a large role in the plans to design Target Field, which opened in 2010.
Smith, in a statement released by the Twins, called his time with the team "the greatest professional privilege I could have ever imagined" and thanked everyone from the Pohlad family to the athletic trainers for their working relationship.
"It gives me great pleasure to hand this baton back to the best baseball man I have ever known, Terry Ryan," Smith said.
Smith didn't immediately return messages seeking further comment.
In addition to the usual general manager duties, the Twins said Ryan will be responsible for succession planning within the baseball department "to identify future leadership candidates." The 58-year-old Ryan, who pitched in the Twins' minor league system, joined the organization as the scouting director in 1986 and has been here since. He served as a special assistant since resigning from the GM role.
The Twins scheduled a news conference for later Monday with Ryan and team president Dave St. Peter.
"As we move ahead, I'm looking forward to the challenge of improving this club for 2012 and beyond," Ryan said in a statement. "We have many assets in place including a strong front office, manager, coaching staff and returning core of players. We have a lot of work to do in relation to development of our roster, but I'm optimistic in our collective abilities to ensure the future on-field success of this franchise."