Steidten is being squeezed out of the club as new manager Graham Potter brought in trusted transfers chief Kyle Macaulay. Macaulay has followed Potter from Ostersund to Swansea, Brighton and Chelsea.
The Athletic says Steidten is now in talks about a contract payoff.
The German was first appointed by West Ham in the summer of 2023, though had a strained relationship with former managers David Moyes and Julen Lopetegui.
Of Macauley's arrival from Chelsea, which received a compensation fee from West Ham for his release, Potter said: “Kyle is in.
"Kyle has been part of my staff for however many years I’ve been coaching. I’m really happy with that appointment. It was something that was always going to happen. It was just a case of when.
“He’s head of recruitment, just to provide a link between the club and myself. Recruitment is about having lots of conversations. To have someone like Kyle to help with that is going to be great for us and great for me.”