With the Giants sliding out of the playoff picture after a frustrating summer, it should be no surprise that a personnel shakeup is at hand. The shock is where the shakeup will start: At the top.

According to multiple baseball sources, Giants' managing general partner and chief executive officer Bill Neukom will not return in that role for the 2012 season. The sources say that Neukom has been asked to step aside by the Executive Committee of the Giants' ownership group. The action is believed to be the fallout from a series of disagreements with the committee during Neukom's three-year stewardship of the team.

The baseball sources also say that Larry Baer, currently the Giants' president and chief operating officer, will assume CEO duties when Neukom steps down. The Giants may try to spin his abdication as some sort of organizational restructuring in which Neukom and his trademark bow tie will be voluntarily assuming another position with the organization.

But make no mistake, it won't be Neukom's idea. And the announcement, when it does occur, has to be considered a stunner and a bit puzzling.
Neukom's relatively brief CEO tenure with the Giants has featured a 2010 world championship that delighted and thrilled the team's fans. But he apparently made some financial decisions that alienated key members of the ownership group -- principally because the group believed as part of Neukom's fiduciary duties, he should have kept them better informed about his choices and actions. Instead, some of the owners first read about those decisions in the news reports.
The situation with Neukom has been kept out of the public eye and behind closed doors, but word of it has been leaking out over the past month. The Giants' ownership structure features 32 people known as "Principal Partners." However, the true power lies in the 10-person Executive Committee, consisting of owners with the most monetary investment in the team. The committee appoints the Giants' managing general partner, who is the front man for the franchise and has authority over day-to-day franchise activities.

The baseball sources say that tension between the committee and Neukom has built over time but supposedly came to a head in recent weeks with the request that he step down. It is unclear when his exit will take place and just how his departure will be handled. He might indeed retain an executive role with the franchise, perhaps one utilizing the legal skills he honed as Microsoft's former top attorney. Neukom is also expected to stay on as an investor in the team.
Fans, of course, will care more about how the 69-year-old Neukom's absence as CEO will affect the Giants' baseball operations. After obtaining the job following the 2008 season, Neukom famously introduced a philosophy and written manual called "The Giants Way," an organization-wide approach to developing baseball talent and setting standards for the franchise's business division.

The Giants subsequently hit the baseball jackpot in 2010 by winning their only World Series title since moving to San Francisco in 1958 -- although there is a debate about whether "The Giants Way" was as much of a factor as the hard work of general manager Brian Sabean and his baseball staff. They assembled a brilliant pitching staff and patchwork lineup that manager Bruce Bochy steered to a championship. Neukom waded into the clubhouse champagne-spraying celebrations along with the players, clearly enjoying the party.

He should have. Neukom was the first Giants principal owner to guide the franchise to a championship since Horace Stoneham in 1954, when the franchise was located in New York. Neukom joined the Giants' ownership consortium in 1995. Thirteen years later, he replaced Peter Magowan, who had been CEO of the Giants since 1993.

Magowan, of course, made his own awkward exit. He took flak for not being more diligent in policing the Giants' steroid issues that exploded in a scandal involving slugger Barry Bonds. But Magowan was criticized primarily for authorizing several exorbitant player contracts, including a $126 million deal given to pitcher Barry Zito. When Magowan stepped down, he denied that he had been forced out and instead announced his "retirement" effective at the end of that season.
Neukom's own falling-out with the Giants' executive committee, say the baseball sources, began over how to spend the additional millions that flowed into team coffers following the World Series championship. For example, one source says that beginning last October, the Giants' merchandising revenue alone has increased by $1.5 million to $2 million per month over previous years. Ticket sales also boomed. The Giants have effectively sold out every game this season.
Neukom, it is said, believed that this was his money to spend as he saw fit -- and he did so, to increase payroll and buy new technology for the baseball department, among other expenditures. Instead, the executive committee allegedly wanted the money to be put in a "rainy day fund" for use in leaner times. The committee also believed that Neukom needed the committee's authorization before making such major financial decisions.
In any event, assuming Neukom does not pull off a last-minute escape act to convince the committee he needs to stay, a new era will ultimately begin for the Giants -- and right now, that possibility provokes more questions than answers. Will a new CEO have a different approach to the Giants' stubborn stance on territorial rights that has prevented the A's from pursuing a new ballpark in San Jose? Will it be a good or bad development for Sabean in terms of assembling a better roster next season?

Neukom has been noticeably under the radar the last few weeks. He was scheduled to appear last week at a sports law seminar at Santa Clara University but canceled at the last minute because of "an unexpected conflict," according to seminar organizers. Neukom also did not show up for a San Jose Giants game which he had told team officials he would attend. In a few weeks, rightly or wrongly, Neukom is expected to have a lot more free time to do whatever he wants.