The Northern Premier League title challengers confirmed the departure of former boss Graham Fenton on Sunday morning as his six-year spell at the 1st Cloud Arena came to an end.
Former Black Cats and England striker Phillips was named as Fenton’s successor within hours in a move that caused much debate amongst the Mariners support and beyond.
Phillips will sit alongside Thompson to watch his new side for the first time as caretaker manager Wess Brown takes charge of Tuesday night’s trip to Ashton United.
A press conference has been scheduled for Thursday morning as Thompson and Phillips meet the media for the first time since the news broke and the latter will oversee his first training session later that day.
Phillips will then get his senior managerial career underway when the Mariners visit promotion rivals Warrington Town on Saturday.
In an exclusive interview with the Shields Gazette, Thompson reflected on a whirlwind period as the club looks to take the next steps in their progression up the non-league pyramid.
“I think we have made the absolute right decision for the club,” he explained.
“Results have not gone the way we have wanted and that’s not to say they have been terrible.
“We still have a chance of promotion and that is the ultimate aim - but given the investment we have made, results from October to Christmas just weren’t good enough.
“We have not lost track of the fact there is still a long way to go into the season, we are only halfway through after all.
“Yes, we had two recent wins, but if a change was made we had to give the new manager time to make an impact.
“I met Graham in early January after the Scarborough game and it was from that point onwards things moved forwards.
“It was sad to part ways with him because we have enjoyed such success, but I absolutely believe we have made the right move going forwards,” he added.
Phillips forged a fine reputation as a prolific striker during a career featuring for the likes of Aston Villa, Birmingham City and Southampton.
But it is on Wearside where he enjoyed the most productive time as he plundered his way to 130 goals in 235 appearances for Sunderland.
After initially hitting form to fire the Black Cats to promotion into the Premier League in 1999, Phillips exploded into the limelight in the top tier.
He hit 30 goals in his first season in the Premier League to become the first and only English player to claim the European Golden Shoe and continued to be a popular figure with the Stadium of Light faithful over the following two seasons.
He departed Sunderland to join Southampton in the aftermath of the Black Cats relegation in 2003 but remained a cult figure on Wearside.
Phillips has gained a reputation as a talented, positive coach during his time with Leicester City, Derby County and Stoke City.
Now he will move into management for the first time in the somewhat surprising setting of non-league’s third tier with South Shields.
Mariners chief Thompson revealed he was impressed with Phillips enthusiasm, knowledge and passion for the area - and reiterated he believes the eight-time capped former England striker is “the right man to take the club forwards”.
“Kevin is very experienced as a player and a coach in a first-team environment,” he explained.
“He has all of the attributes you need and we have a good foundation and good people around him.
“He has all of the skills required to be a success for us and we can be a success for him.
“Yes, like Julio Arca signing for us, interest from Sunderland supporters is a by-product of the decision.
“But it is by no means the core reason, the key reason is to get promoted and to win football games to help us do that.
“We want to continue the progress we have made and I think he is the right man to help us get there.”
The appointment of Phillips has caused surprise around the non-league scene and beyond.
The 48-year-old had been linked with several jobs in the Football League and had expressed an interest in taking over at Sunderland on two separate occasions.
For those reasons, getting a managerial career underway in non-league football can be seen as a risk on both sides of the agreement.
But Thompson is insistent that it is a risk worth taking.
“Kevin obviously wants to progress his career and if we can help him on that journey, that would be fantastic,” he added.
“If he is huge success, we know we might have a fight on our hands to keep hold of him - but that is something that would only come because he has done well with us.
“He is taking a risk starting at this level, and it’s a risk for us as any move is with a football club.
“But that means everyone is aligned and to Kevin’s credit, he is up for the challenge.
“He is fired up, he is raring to go and I am sure he will do for us and we will do well for him.
“We are all excited for what lies ahead for the football club.”