Speaking at his official unveiling, Smith described the decision to leave Brentford and join his boyhood club as "not emotional but totally rational."
Smith's father, Ron, was a steward in the Trinity Road Stand and a large number of his family are Villa fans.
But former Walsall boss Smith insisted he did not base his decision to join Villa on prior allegiances.
He said: "It means quite a lot due to my allegiances as a child and my father working for 25 years here as a steward.
"But people sometimes forget I have been involved in professional football for 30 years and none of those have been with Villa.
"My allegiance was here as a kid and I have kept hold of that allegiance. For me this was not an emotional decision. It was a totally rational one. The emotions come from the rest of the family."
Villa currently sit 15th in the Championship, following a run of one win in 10 games which led to Steve Bruce's dismissal.
But Smith, who has been joined by long-time assistant Richard O'Kelly and former Villa skipper John Terry, believes promotion can still be achieved.
He said: "It's a challenge because they are sat 15th in the Championship. I know this club, I know the supporters and the demands. We should be higher. That is the challenge. To make sure we improve.
"It is a realistic aim to be promoted this season. It has to be the aim. I have been in this league now for three or four years. This is the most even league since I have been in it."
Chief executive Christian Purslow described Smith as having "oustanding qualities."
He said: "Dean is hugely experienced in English football and hugely experienced in the Championship.
"He has dedicated his career to a very reconisable playing style. He has committed to that playing style through thick and thin.
"Most importantly, he has a very recognisable philosophy. His motivation, his energy and his hunger to manage at the highest level is another outstanding feature.
"He understands what Villa is all about. Those are very good qualities to make an outstanding manager of Aston Villa."