The former Scotland manager was handed the position on Monday by new owner Ann Budge, who also installed former club defender Robbie Neilson as first team coach.
Levein, who played 326 times for Hearts between 1983 and 1997, has been out of work since losing his position with the Scotland national team in November 2012.
The 49-year-old, who along with Neilson was drafted in to replace the management team of Gary Locke and Billy Brown, said: "My role here is more about strategy than anything else.
"It is about putting in place a top-to-bottom system which will allow the club to develop young players. We will take them in at seven, eight or nine years of age, bring them through the system into the first team. That is the strategy the club wants to put in place.
"I won't go into everything I do but on top of developing players my job is also to find a head coach and other coaching staff who will fit into the skeleton which I presented to the board. My role is more about overseeing than anything else."
Asked if he will be picking the team, he said: "You should ask Robbie about that."
And Neilson, who steps up from heading the youth academy, said: "I will pick the team. Craig spoke to me on Sunday and that was one of the first questions I asked him.
"He assured me I would and that is the reason I am sitting here. Why wouldn't I pick the team? It is my job to train them during the week, to assess them. I will discuss things with Craig and other coaches but I will make the ultimate decision.
"We will meet on the day after the game, discuss it again, then move forward from there... but I will pick the team."