Weeks after his release from Boston, Michael became a coach with the Yankees. Reggie Jackson credited Michael's scouting reports for helping him hit those three home runs in Game 6 of the 1977 World Series. He served as manager of the Yankees Triple-A team in 1979, and as general manager of the Yankees in 1980. Michael then served as the Yankees' manager in 1981 and again in 1982. At one point in the 1981 season, annoyed by George Steinbrenner's constant interference, he challenged the Yankees owner to fire him, which he did. Michael finished with a record of 92 wins and 76 losses over both stints as Yankees manager. Michael returned to the Yankees front office in 1983, and again served as a coach starting in 1984. He next managed the Chicago Cubs in 1986 and 1987. His managerial record with the Chicago Cubs was 114 wins and 124 losses.