He moved into management with York as player-manager ahead of 1982–83, accepting the position on 12 May 1982. He described the set up at Bootham Crescent on his arrival as a "shambles", as training consisted entirely of running and was devoid of any actual coaching. He signed veteran players Roger Jones (goalkeeper), Alan Hay (defender) and Ricky Sbragia (defender), as well as young Stoke defender Chris Evans, which including Smith himself meant a complete change in the club's back line. He brought in striker Viv Busby as a player-coach. He then made 26-year-old striker Keith Walwyn his priority, and encouraged Walwyn to use his natural physical presence to become a greater threat in front of goal and unlock his potential. Smith retired from playing after steering York to a seventh-place in 1982–83, in which he made 36 appearances and scored 4 goals. He signed Sheffield United's John MacPhail on a free transfer as a replacement for himself.