West Brom will waste little time in seeking a replacement for England-bound head coach Roy Hodgson with Birmingham boss Chris Hughton high on their list of possible targets, Press Association Sport understands.
Albion anticipate Hodgson will accept the chance to become the successor to Fabio Capello with talks planned with the Football Association.
Hughton came close to replacing Roberto Di Matteo at The Hawthorns 15 months ago after being sacked by Newcastle and was interviewed for the post before Hodgson was chosen.
But he has further enhanced his reputation since taking charge of Birmingham last summer.
Despite losing most of last season's relegated squad, and financial restraints, Hughton has guided Blues into the npower Championship play-offs.
City also acquitted themselves well in the Europa League and held Chelsea to a replay in the FA Cup before bowing out in the fifth round.
Compensation would be an issue and Birmingham will be keen to hold on to Hughton after Alex McLeish quit last summer to join Aston Villa.
It is believed the Baggies are also considering former coach Michael Appleton - now manager at Portsmouth - and Bristol City boss and former Albion midfielder Derek McInnes.
Alan Curbishley, who rejected the chance to take the Wolves job in February, former Birmingham boss Steve Bruce, Cardiff's Malky Mackay and Charlton's Chris Powell are also potential candidates.
Former Republic of Ireland international Reid, 31, has operated in midfield for the majority of his career.
But he has been successfully converted into a right-back by the Baggies and played a major part in them becoming established in the Barclays Premier League.
Reid initially joined West Brom on a month's loan from Blackburn towards the tail-end of the 2009-2010 season when they sealed promotion from the npower Championship.
He completed a permanent switch to Albion that summer when he also announced his retirement from international football after winning 23 caps.
Albion sporting and technical director, Dan Ashworth, said: "We're delighted to have agreed a new contract with Steven.
"He's had a good, solid season and proved he is still more than capable of playing Premier League football.
"He is also a fantastic person to have around the training ground.
"Steven is valued by the club not just because of what he brings to the football field, but also his contribution off it.
"He has an important role to play as we look to establish ourselves as a top-flight club."