The Baltimore Orioles began the restructuring of their front office by informing executive vice president Jim Beattie on Monday morning his contract will not be renewed when it expires on Oct. 31, according to owner Peter Angelos.

Mike Flanagan, formerly vice president of baseball operations, will take over Beattie's title and assume his responsibilities.

"I think the past three years Jim Beattie has been leading the effort with strong assistance from Mike," Angelos said. "Now it will be Mike's chance. I think Mike is very capable and a very bright guy who certainly is adequate to perform the job."

The team will look to bring in another executive to help with the day-to-day operations, but there is no question that Flanagan is the boss and the dual general manager system has been discarded.

"Mike will be absolutely in charge," Angelos said.

Beattie and Flanagan did not return phone calls.

According to a team source, Beattie has been offered a job as a consultant.

The Orioles also started the process of bringing back interim manager Sam Perlozzo, baseball sources said, though a contract may not be finalized for several days. Flanagan's appointment as general manager makes it likely that Perlozzo will be back.

"I can't say anything about that," Angelos said. "He certainly is being strongly considered."

Perlozzo said he was waiting to hear from Flanagan about setting up a possible meeting.

Just how the Orioles fill roles to assist Flanagan is unclear. New York Mets assistant general manager Jim Duquette spoke with Angelos and Flanagan briefly last week but, according to a baseball source, there has been no meeting or interview set up. One Orioles executive mentioned Dick Tidrow, vice president of player personnel for the San Francisco Giants, as a possibility.

According to team sources, Beattie called several employees on Monday morning to tell them of the news.

"I think it was a frustrating year for the owner," one team official said. "Somebody had to take the brunt of it. I hate it for Jim because I thought he was capable and could have done a good job. Somebody had to take the fall."

Though the two GMs were friendly with one another, Flanagan's insistence on using psychological tests and quantitative analysis to determine player transactions was in contrast to Beattie's beliefs.

Specifically, sources said, Flanagan's close relationship with Dave Ritterpusch, the Orioles' director of baseball information who is in charge of the analytical information, proved bothersome for Beattie. Insiders say Ritterpusch's theories were pushed on Beattie.

"Dave gets in the way a lot," one team official said.

"The organization has been hampered by it," said another official. Ritterpusch "tries to get involved in everything."

Ritterpusch said he has tried only to provide helpful information.

"I'm really offended that the hard work we did, someone would try to use that as something negative," Ritterpusch said. "Everything that we put together was for the sake of the Baltimore Orioles. It's unfortunate people would use this for their own narrow-minded purpose. What Jim is able to do is between him and the owner and Jim and the other teams he negotiated with. This organization when we came in here was so weak and the farm system was so weak. It takes a lot of work to turn it around and you need all the tools available."

Ultimately, Beattie never asserted himself, according to team sources, perhaps because of Flanagan's close relationship with Angelos.

The two general managers, hired prior to the 2003 season, landed all-star shortstop Miguel Tejada, but did little to change the performance of the team. Baltimore finished this year with its eighth consecutive losing season.

Several executives around baseball said the duo often was difficult to deal with in trade negotiations and made ridiculous player demands.

"I tried to contact both for over a week this summer at the trade deadline to discuss players and did not get one call returned," one National League executive said. "The only club of the 29 that did not return a call."

Many had theorized that Beattie was hired to mentor Flanagan, who had never been in a front-office role.

"That was the original intent and understanding," Angelos said. "Jim came on three years ago with the understanding of working with Flanagan for a period of time that would result in Mike assuming the position of general manager of the ballclub."

But in an interview prior to the season, Beattie said of that arrangement, "I've heard that theory, but it's never been a concern of mine."

Angelos said he is determined to improve his ballclub and he will spend money on free agents this offseason.

"I think we know where we want to go," he said.

When told that the team had made a similar pledge last season and did not sign one free agent of note, Angelos said, "That certainly wasn't my decision."

One of those free agents could be Rafael Palmeiro. Angelos did not rule out bringing back the first baseman.

"I think Raffy has retired basically," he said. "He hasn't told me that. But I don't think he'll come back."

Palmeiro's positive steroid test and pitcher Sidney Ponson's legal troubles caused much concern for the Orioles this season. Angelos said Ponson's arbitration hearing likely will be scheduled for January and that the team is willing to negotiate a settlement with the pitcher, whose $10 million contract for next season was terminated after the pitcher had his third alcohol-related arrest in a year in August.