The 22-year-old new boy has the same kind of versatility as his Reds teammate, according to Sherwood.
The 22-year-old defender joined Villa on a season-long loan from Liverpool on deadline day and is now expected to provide cover for team captain Micah Richards, Joleon Lescott, Ciaran Clark and Jores Okore at centre-back.
However, he is also more than capable of filling in at right-back or even as a defensive midfielder, prompting Sherwood to compare the Portugal Under-21 international to Liverpool teammate Emre Can, who has featured in various positions during his time at Anfield.
"He can play right-back, centre-back and I see him playing holding midfield as well”, said the Villa boss. "I see him like an Emre Can. He's been successful playing in every position.
"A lot of people say that if you don't nail down one position, it's detrimental to your career. I don't believe that. I believe it gives you the chance to play more minutes.”
Born in London to an English father and Portuguese mother, Ilori joined Sporting Club de Portugal as a trainee in 2006 at the age of 13, before rising through the ranks to earn his first-team debut in November 2011.
The promising defender went on to make 14 total appearances for the Primeira Liga giants until sealing a £7 million switch to Liverpool in September 2013 but he is still to make his debut for the Reds, having spent the last two seasons out on loan at Spanish side Granada and French outfit Bordeaux.
He might never appear for the Anfield outfit now, however, with Sherwood confirming reports that Villa have the option to make his spell permanent at the end of the season – for a fee believed to be between £6 million and £9 million [h/t Liverpool Echo].
"Tiago is a player I have known since he's been at the academy at Sporting Lisbon,” added Sherwood. "I wouldn't have taken him on loan if there wasn't an opportunity to buy him at the end of it. I am not interested in developing players for other clubs. I am interested in developing for ourselves.
"He's quick and elegant. He's played in four different countries, when you include England. He's had a good rounded development.
"If he becomes what I think he can be, he's a good buy at the money we're talking about.”
It remains to be seen how much Ilori will feature for the first-team over the coming months but, with right-back being one of Villa’s weakest areas, he could have a good chance to earn some minutes over the likes of Alan Hutton and Leandro Bacuna if he makes a good first impression.
With Sherwood also developing a reputation for nurturing emerging talents into Premier League stalwarts, it looks like he has landed in the perfect place to help him make the next step in his career.