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Morgan has called time on his playing career after failing to recover from a serious knee injury sustained in 2010.
He will now join the backroom staff at Bramall Lane on a permanent basis after helping out with the reserve team last year.
"I have been desperate for him to come onboard full time because he was fantastic last season," Wilson told the club's official website.
"Chris and I go back a long way, probably about 15 years, when he was a young, budding centre-half and back then Chris learned a lot from the likes of Mal Shotton and Eric Winstanley.
"Chris has a lot of respect within the game so it is sad that he has had to call it a day when I am sure he could have played much longer. There are about 200 strikers across the country breathing a sigh of relief at this news."
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