Following his exploits at the World Cup, Colombia international Rodriguez completed his blockbuster transfer to Real from Monaco on Tuesday, signing a six-year deal believed to be worth €80 million.
Prior to playing for big-spending Monaco in Ligue 1, Rodriguez spent three years with Portuguese giants Porto - then led by Villas-Boas, who is now coaching Zenit Saint Petersburg in Russia.
In his time at the Estadio do Dragao, Rodriguez won eight trophies - including three Primeira Liga titles and a UEFA Europa League crown - playing as an attacking midfielder behind the likes of countryman Radamel Falcao and Hulk.
Villas-Boas said he believes Real will get the best out of the 23-year-old if his played in a similar position in Madrid.
"A creative player like him has to have freedom of movement on the pitch," Villas-Boas told Marca.
"In my opinion, the best position for James is in the number 10 spot, where he feels most comfortable. From that position not only can he finish the move himself, but he can also link up with a better-placed team-mate."
Villas-Boas is confident Rodriguez will settle quickly among a star-studded dressing room that includes Cristiano Ronaldo, Gareth Bale and Toni Kroos.
"He has all the qualities to adapt to Real Madrid's requirements. I say this on account of his natural disposition and calm," the former Tottenham coach said.
"I think this will help him settle in. Plus he's very courteous and I'm sure he'll be well received in the squad - something that will undoubtedly help him."
