Giles was today confirmed as the permanent successor to Peter Moores as coach and he also replaces Mike Watkinson as Director of Cricket.
Despite suffering their second relegation in three years, Giles believes promotion is a realistic goal for next season.
Giles said: “It is our intention to return to Division One but our main aim is to create something both successful and sustainable, which a club with such an incredible history deserves.”
The 41-year-old Ashes winner has previously coached Warwickshire, winning four domestic titles, including the County Championship in 2012.
Giles was also part of a four-man team in charge of national selection before becoming the England One-Day coach.
The former spin bowler is looking forward to the challenge and is excited by the prospect of leading Lancashire out of the disappointing position which they currently find themselves in.
He said: “Lancashire is a massive club with a rich pedigree and history, and I am thrilled by the prospect of coaching them.
“I cannot wait to work with the players and staff."
Chapple played the dual role of player manager last season and Giles is looking forward to working alongside the Lancashire veteran.
“From my point of view, it’s really exciting to have Chappie alongside me. He’s the heart and soul of this club that we need to really build back into this ground and this team, and his experience here is going to be hugely valuable to me."
Giles takes charge with Lancashire back in Division Two of the County Championship and a number of key issues which need addressing.Glen Chapple's side finished the season with the second fewest number of batting points in the first division, achieving a first-innings total of 350 on just two occasions.
Lancashire's top-order struggled to compete in Division One last season, depending largely on leading run-scorer, Ashwell Prince.
The South-African batsman has revoked his decision to retire from all forms of cricket this winter and if he continues to play on, he will be a valuable part of Lancashire's plans next season.
Lancashire must also address their tribulations with the ball, following the retirement of Kyle Hogg with captain Chapple likely to follow next winter.
Nathan Buck has already joined the Lancashire roster, but Giles' arrival could lead to a change in personnel at Old Trafford.
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