Walsh, 68, indicated Wednesday that he could step down after this season. Donahue has been considered Walsh's heir apparent since joining the 49ers in 1999.
"I have another year on my contract following this one," Walsh said at the 49ers training camp, "but I wouldn't eliminate the possibility of stepping away sooner."
Donahue, the former UCLA coach, will continue to be involved with the draft process and expand his responsibilities in contract negotiations, personnel decisions and administrative duties, Walsh said.
"As time goes on," Donahue said, "I'll start taking more of those responsibilities on."
Donahue, 56, coached the Bruins from 1976-95, winning 98 Pac-10 games, the most in conference history. Before he joined the 49ers, he was an analyst for CBS Sports.
He said he's excited about the future.
"I want to play. It's like being the backup quarterback. You want to play," he said. "For me to say, `No, I'm going to be patient forever,' that's not accurate. I want to play, but at the same time I want to be respectful and appreciative of what Bill Walsh and (vice president) John McVay have meant to this organization. And I'm going to continue in that role."
Walsh said he expects the addition of Donahue, new 49ers president Peter Harris and others in the front office will help alleviate problems associated without he salary cap.
"Our problems, if there are any, are related to the salary cap," Walsh said. "But we see ourselves dealing with that directly, and each year that passes we're less affected by it. We expect to have just one more year of the salary cap issue. We've addressed it."
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