Keegan's downfall: a loss of dressing-room support

City of change: Manager's exit might persuade stars like Wright-Phillips to stay as promoted Pearce makes an impact

Manchester City's chairman, John Wardle, admitted for the first time last night that it had been wrong for Kevin Keegan to announce so far in advance that he would be leaving the club at the end of next season. The result was an unexpected level of unrest in the dressing room, with players reluctant to commit themselves for the long term without knowing who the next manager would be or how highly he valued them.

The board, understandably, were unwilling to add to the £50 million Keegan had spent in under four years, and a vicious cycle developed in which poor results further diminished his rapidly waning enthusiasm for the job.

With a demotivated squad in danger of subsiding gently into the lower reaches of the Premiership, City decided it was better to hand over more than £1m in compensation to Keegan and attempt to recover it by finishing higher up the table - every position is worth £500,000 - under the hugely ambitious City coach and former England international Stuart Pearce.

What surprised club officials most was discovering the lack of respect Keegan commanded among the players. The word from the dressing room was that he had scarcely a supporter left, and that, contrary to fans' fears, stars like Shaun Wright-Phillips are now less likely, not more likely, to leave.

Keegan is understood to have been regarded as old-fashioned and out of touch, putting on uninspiring training sessions with too much emphasis on simply playing five-a-side games, as if the football world had not moved on since the days of his mentors Bill Shankly and Arthur Cox. Players yearned for the more scientific approach now employed at most other clubs, and even had to request extra training. Keegan was more inclined to give them, and himself, extra time off.

David James, the England goalkeeper and City's unofficial shop steward, publicly hinted more than once at his team-mates' concerns, most recently last week, when he said: "It would be nice to know that something is going to happen and when it's going to happen." As the change of manager was not due for another 15 months, it was read as a significant coded message.

James expanded yesterday: "Sorting out the manager's situation was critical if we were going to establish some direc-tion and consistency. If it was going to happen in the summer, it is much better to have made the break [now]. We had been embracing more modern methods and studying more videos, but I'm not sure Kevin will ever change as a manager. He has achieved many things in the game and is one of the biggest personalities, but management has moved on.

"I do not want to belittle what he has done because he brought City back to the Premiership, but it is hard to see him returning to the dugout."

Since the embarrassment of an FA Cup defeat by lowly neighbours Oldham Athletic early in January, City have beaten only the relegation candidates Crystal Palace and Norwich. The defence has tightened up from the 4-3, 3-4 days, but credit for that is given to Pearce. The former England captain strikes the chairman as "a very professional guy", who regularly sits next to him during matches, passing on his shrewd observations. Officials are also impressed that, in contrast to Keegan, Pearce is already taking an interest in every aspect of the club, demanding a report from each head of department early this week.

He is not yet regarded as the favourite to become manager next season, but will win increasing support from players and fans if results go well in the remaining nine games, only one of which - at home to Liverpool - is against a team in the top six.

Even if a high-profile candidate such as Martin O'Neill, Sam Allardyce, Iain Dowie or Gordon Strachan agreed to take the job this summer, they would be under pressure to keep Pearce on as a coach.

Wardle, who had been Keegan's staunchest supporter at board level, said of announcing his planned departure so early: "It was a mistake. Whether [or not] it triggered this, it was obviously a big part of it. Sometimes you say things and especially in his position, you're in trouble, aren't you? Once that came out, that probably was an important part of it.

"Players obviously need to know what's happening and who's going to be the gaffer. I think perhaps in the last few weeks he was feeling he couldn't do a lot more. He found it difficult, he wants to move on all the time, he's a very ambitious guy and that won't change, he drives and drives for success."

That does not mean Wardle would have done anything differently when seeking a successor to Joe Royle after relegation from the Premiership in 2001. "I believed in him and wouldn't change my mind," he added. "I believe it was right at the time and I still believe that. But over the last few weeks it changed. I think he suddenly looked and thought, 'I can't go any further, I can't do any more for the football club'. Kevin's a very honest guy. He'll tell you how he sees it, and that's exactly what he did."

Indeed, Keegan claimed only last week that in a few years' time, supporters would desert football because the top clubs, financed by Champions' League money, were so far ahead of the rest. Inability to push City, with their £62m debt, into that élite group was his greatest frustration. He will nevertheless be shocked to discover this weekend what many at the club really thought about him.