BALTIMORE, OCT. 5 -- Baltimore Orioles owner Edward Bennett Williams, saying he was tired of watching his team "lose and lose and lose," today fired General Manager Hank Peters and farm system director Tom Giordano and began what he called a "reorganization of the Orioles' front office."

Williams, as expected, also announced that Manager Cal Ripken Sr. would return for a second season.

The first part of the reorganization began with the promotion of special assistant Doug Melvin, 34, to interim farm director. In the next few weeks, Williams said, he will sort out positions and titles but he expects to have a general manager, farm director and scouting director to run baseball operations.

Melvin, who joined the Orioles in January 1986 and began a two-year study of the minor league system and scouting operation, is certain to have one of those jobs, although it isn't clear which one.

Williams said today he might interview several people for the posts. He refused to name candidates, but among those people believed to be high on his list is San Diego Padres General Manager Jack McKeon. In the past, Orioles coach Frank Robinson has expressed an interest in such a job.

On a hectic, emotional day at Memorial Stadium, even as Williams was finishing a round of news conferences, Melvin was beginning the task of reworking a scouting staff that has been criticized for its failure to feed talent into the farm system.

The firing of Peters, 63, wasn't unexpected, and Peters admitted, "We'd talked enough that I felt something was going to happen."

It finally happened at 11 this morning, when Williams walked into Memorial Stadium and announced he intended to become more involved in the day-to-day operation of the Orioles and that Peters and Giordano were being fired.

Peters has two years remaining on a contract that is worth more than $200,000 per year. Ironically, the awarding of that "lifetime" contract was one of the first moves Williams made when he bought the Orioles in 1979.

Several years later, Williams reflected on that move, saying, "I felt I had to do two things immediately: lock in Peters and {then-manager Earl} Weaver. I wanted to secure their futures with the Orioles."

However, the two men have disagreed on moves many times in recent years, and Peters' firing probably became inevitable in 1984 when Williams spent $11.4 million to sign free agents Fred Lynn, Lee Lacy and Don Aase.

Williams said he was forced to make the moves because his farm system was depleted. Peters disagreed vehemently, believing that the farm system would have done as well as, or better than, the free agents.

In retrospect, the moves have failed, and many moves the Orioles would like to make will be hindered because a couple of aging players have huge contracts.

But those 1984 signees cost the Orioles three picks in the 1985 draft, and after that, a pattern was established: while Peters had always built through the farm system, Williams wanted quick fixes.

In 1985, Williams pushed Peters to make a trade for second baseman Alan Wiggins, who had a $2.8 million contract. Then after the '85 season, he signed outfielder Juan Beniquez for $500,000, and a year later, he signed second baseman Rick Burleson for $475,000 and third baseman Ray Knight for approximately $1 million over two years.

The moves may have helped the Orioles sell tickets, but the club never improved. After winning the 1983 World Series, its record has gotten progressively worse in four consecutive seasons, ending with this season's 67-95 mark.

"When you start on that course of action, you have to keep at it," Peters said. "You can't back off and say, 'Okay, now we're going to go with kids.' "

In Williams' defense, the Orioles farm system wasn't doing its job.

"I love Hank," an American League general manager said, "but that farm system was terrible. His friend {Giordano} didn't do him any favors."

So now, Williams and Peters move on, in different directions, and what was once one of baseball's most successful franchises begins anew, this time with Williams clearly running things.

"I think if someone owns 100 percent of something, he's entitled to voice an opinion," Williams said. "I do voice an opinion and will continue to. Sometimes the opinions have been wrong, but I don't think it was wrong to voice one."

Meanwhile, Peters said he'll take some time off before deciding what to do, but left little doubt he'd like to run another team. He has been rumored to be under consideration for a similar job in Cleveland, but says he has had no conversation with anyone near the Indians.

In an hour-long news conference, his voice cracked twice as he reflected on 12 years with the Orioles, an era when the club averaged 89 victories a season and until 1984 had finished lower than second only once.

He refused to criticize Williams, but left no doubt about his feelings. He said if Williams wanted to take a more active role in running the club, "The man who sits in my chair won't be in a position to make decisions . . . An owner has every right to do that, but I don't think I could continue" under such an arrangement.

"I guess you could say I'm relieved to be relieved," he added.

Williams didn't attend the news conference with Peters, but did meet briefly with the media. He emphasized that he had stayed out of the running of the Orioles in 1987, but that he felt that after losing 95 games, the organization needed to move in another direction.

He refused to admit the free agent moves hadn't worked out, saying only that he didn't like to waste time looking back.

"I came to the conclusion that it was time for a change," Williams said. "I came to it unhappy. I'm not patient by nature, and I've suppressed my impatience for a long time. I made a very conscious effort not to say anything."

The Orioles lost, he said, because of an "arid period in scouting and maybe because our intelligence {scouting} system wasn't functioning properly. It wasn't that we were scrimping because we were spending a lot."

Williams said he became concerned about the farm system "two years ago" and expressed "my disenchantment with the people here. I was reassured that everything was fine. Eventually, I realized everything wasn't fine."

He also refused to concede that the Orioles were in for a long rebuilding period.

"I'm not going to say that," he said, "because I don't believe that. I think we can turn it around in a hurry. It's been done before."

Meanwhile, Ripken wouldn't comment on his rehiring or today's developments. "I can't say anything because I don't know everything that has happened," he said.