MELBOURNE'S Chris Connolly, the man who copped the biggest punishment from the AFL's tanking investigation into the club, has lost his job.

Connolly's position as general manager of club development has been made redundant, in what the Demons say is a money-saving measure.

The former Demons football manager, who signed a two-year contract earlier this year, is still serving a suspension from any role at any AFL club, which stretches until February next year.

The Demons have also parted with Neil Craig, the club's director of sports performance, who was caretaker coach for the last half of this season after Mark Neeld's sacking.

Former Adelaide coach Craig is tipped to be part of Essendon's new coaching panel.

Connolly was a central figure in the AFL's investigation into allegations the Demons tanked for draft picks late in the 2009 season.

While the club was technically cleared of tanking, they were fined $500,000 in February, Connolly was suspended for a year and then-coach Dean Bailey, now an assistant with Adelaide, was suspended for the first 16 rounds of this season.

Melbourne chief executive Peter Jackson said on Thursday the decision to part with Connolly, after six years with the Demons, was purely a business move and he regarded Connolly as a good football person.

"This is not a performance-based decision, but reflects the need to reduce the overall cost of our management structure," Jackson said.

"Chris will leave a strong legacy at the Melbourne Football Club."

He said the club had honoured Connolly's contractual obligations.

Connolly expressed his disappointment.

"As a life member of the Melbourne Football Club, I am disappointed I cannot assist the club into the future in a full-time capacity," he said.

"I respect the fact that our new leaders in president Glen Bartlett, CEO Peter Jackson and senior coach Paul Roos deserve the opportunity to do it their way."

Jackson said Craig's role had also been made redundant after the appointment of an experienced senior coach in Roos.

The Demons are yet to appoint Roos' senior assistant, who will be earmarked to take over the top job in two or three years, under the succession plan outlined when Roos was named as coach in September.