Pete Mackanin will not return as the manager of the Philadelphia Phillies in 2018, the team announced Friday.
Mackanin instead has agreed to an extension to serve as the special assistant to general manager Matt Klentak "for 2018 and beyond," according to a team statement.
Mackanin, 66, will finish out the 2017 season as the team's manager. He has gone 173-237 since replacing Ryne Sandberg in 2015.
"I'm disappointed, surely," Mackanin said Friday, before the team's 6-2 win against the Mets. "But I understand it and I'm happy to be part of it down the road. I believe in Matt Klentak and I believe in what he's doing and the fact that he wants me to continue in this [new] capacity is the most important thing."
Mackanin received a contract extension through next season on May 11 after the Phillies had lost nine of 11 games. They went 4-16 in 20 games afterward.
Philadelphia has improved since the All-Star break, going 36-37. That wasn't enough to secure Mackanin's return. Klentak said members of the coaching staff will be determined by the new manager.
"The way the rebuild is evolving, a new voice in the dugout and a new style is necessary," Klentak said.
The Phillies are 65-95 this season, last in the National League East and with the second-worst record in the league. Philadelphia has not been to the postseason since 2011.
Mackanin, who also played for the Phillies during the 1978-79 seasons, has spent 10 seasons with the franchise as a coach and manager.
He served as Philadelphia's bench coach for four seasons from 2009 to 2012 under Charlie Manuel. The team won three of its five consecutive NL East titles in that span. He became the third-base coach in 2014 and served in that role until Sandberg abruptly resigned.
"Pete was an excellent manager for the time he was here," Klentak said. "I was a rookie general manager and I learned a ton from Pete and will continue to do so."
It's no surprise players were taken aback by the decision. Mackanin was popular in the clubhouse.
"Obviously it's tough," outfielder Aaron Altherr said. "Wish we could've played better for him to stay. Everybody is shocked. I thought he'd be around for next year after he got the extension."
Rhys Hoskins, who was promoted to the big leagues in August, thrived under Mackanin.
"I really enjoyed having him around," Hoskins said. "He's a great baseball mind. To have that in your corner is something that will stick with me."
Klentak said he'll immediately begin identifying candidates to replace Mackanin. He said candidates from a variety of backgrounds will be considered and they don't need to have managerial experience.
Dusty Wathan, who managed several of Philadelphia's young players in the minor leagues at Double-A and Triple-A, likely will be a top internal candidate. Cubs bench coach Dave Martinez and White Sox bench coach Joe McEwing also could be on the list.
Information from The Associated Press was used in this report.