The former Reds skipper has been at the Liverpool Academy in Kirkby since January and is ready for his first major coaching role.
"He's been through all the levels so I would think it was the right time for Steven to step up," said Phil Thompson, former player and assistant manager at the club.
"Stevie does understand you've got to learn your trade. Sometimes you can't just go from being a player.
"He's been going around the teams there at Liverpool, helping out with everybody, this is the next step in his development."