Club president Joey Saputo removed his friend and long-time Impact player, coach and manager Nick De Santis from his job as sporting director on Wednesday and handed control of the Major League Soccer team to Klopas, the head coach and director of player personnel.
"Nick will have an administrative role, but will not be involved in the management of the technical team," said Saputo.
Pressure from fans and the media had been building since the end of last season to replace De Santis, who seemed to be out of answers for a free fall that began with a 1-6-1 finish to the 2013 regular season and a 3-12-5 start to the 2014 campaign.
De Santis's failure to make off-season changes other than replacing coach Marco Schallibaum with Klopas was his undoing, as the same weaknesses on defence and in the midfield that were exposed late last summer carried into this season.
Now Klopas will have full control to decide who will play and who will sit out, and what trades or signings will be made.
"He will have the responsibility to tweak this team according to what he feels he needs to be more competitive for the remainder of this season, the 2014 CONCACAF champions league and the 2015 season," said Saputo.
The Impact have already made a handful of player moves since April, shipping out defender Jeb Brovsky, midfielders Collen Warner and Sanna Nyassi and forward Andrew Wenger. Midfielder Hernan Bernardello left in midseason to sign with a Mexican club.
None of the moves made much difference as the Impact, now on a five-game losing run, sank further into the MLS basement.
Saputo hopes to eliminate confusion over who is in charge, particularly among the players brought in by De Santis and those acquired by Klopas.
"I want the message passed to the players that the person on top is Frank Klopas and not Nick De Santis. It's Frank who is the players' boss," he said.
Klopas is the Impact's third head coach in as many seasons in MLS, following Jesse Marsch for the expansion season in 2012 and Schallibaum last year.
Saputo said he has assured Klopas, who signed in December for two years plus an option year, that he will have his job at least until the end of the 2015 campaign.
"He has the security regardless of what happens this year, so if Frank decides tomorrow that he wants to start playing some of the younger players, I give him full responsibility, knowing that his job is not on the line," said Saputo. "It's obvious we need to change."
The 47-year-old Klopas has extensive MLS experience as a player and as a former technical director and head coach of the Chicago Fire. It was De Santis who pushed for him to be hired.
"It's great to have the support, but I know in my position I need to get results," said Klopas. "I'm the head coach, I know I'm responsible.
"It's good to know I have some time to work and try to fix it. I still have confidence in the group and the players we brought in. Even though we're dropping games, I think were playing a lot better. We'll continue to work hard every game to the end and try to find solutions."
While reaching the MLS playoffs will be a long shot with only 14 regular season games left to play, the Impact can save face with a strong showing in the Champions League. They begin CONCACAF play Tuesday at home against FAS of El Salvador.
One of the club's high points came in 2009 when they drew more than 50,000 fans to Olympic Stadium for a quarter-final against Santos Laguna of Mexico.
They also expect to have a second designated player, Argentine midfielder Ignacio Piatti, in camp starting next week.
More player signings, although not a new DP, are planned for the off-season.
Captain Patrice Bernier, who was a teammate of De Santis in the early 2000s, was surprised but said the move shouldn't affect the players.
He said it was up to the squad to "give back pride to ourselves and the team and fans. Seasons aren't always great, but you can always at least save the honour of the club you represent."
Saputo did not say what De Santis's new duties will be.
Montreal native De Santis has been part of the Impact since the team was formed from the ashes of the defunct Montreal Supra in 1993. The 46-year-old won an APSL championship as a player in 1994, won the A-League title as coach in 2004 and got a USL First Division championship as a manager in 2009.
"He was a key element and architect of this organization and one of the reasons we are in MLS today," Saputo said of De Santis. "He is a friend, however, we are in a results-driven business and unfortunately, since July 2013, our results have not been what we expected them to be and he's paying the price for it."
Midfielder Dilly Duka, acquired Tuesday from Chicago for Sanna Nyassi, had his first workout with the Impact and said he was happy to work under Klopas again.
The Impact's next game is at home Saturday against Toronto FC.