Captain Tom Westley, spinner Simon Harmer, pace bowlers Jamie Porter and Sam Cook, batsman Nick Browne and all-rounder Paul Walter remain with Essex from the squad that won the title under Silverwood in 2017 after being promoted the previous year.
His first game as manager next summer will be a home game on April 4 against Surrey, the title winners for the last three years.
“We were always clear that we were focused on making the right decision, not just a quick one, and after this process we feel strongly that we stuck to it and appointed the best candidate,” said Jason Gallian, Chairman of the cricket committee.
“Having spoken to Chris, I know how motivated he is to make a name for himself in the coming years and his desire remains strong to take on the role of director of cricket and lead the strategic side. “
Essex achieved the Championship/T20 Blast double in 2019 and added the Bob Willis Trophy the following year, but have not won anything since.
They finished fourth in the Championship this summer, failing to make the knockout stages in either the 20-over or 50-over white-ball competitions.
Former pace bowler Silverwood took 577 first-class wickets during his playing career, including spells at home in Yorkshire and Middlesex, and played six Tests and seven one-day internationals between 1996 and 2002.
He first joined Essex as bowling coach in 2010 and was promoted to head coach in December 2015, succeeding Paul Grayson.
“People rightly focus on the success around 2016-2017, but they forget that Chris was here for several years before he did a lot of work in the second eleven,” general manager Dan Feist told BBC Essex.
“He identified Jamie Porter and worked with him on his skills and Sam Cook when he came across, so he knows what that looks like.”
“He’s got two of his own guys on the way at the moment, so he’s really confident in this opportunity.”
“He is really interested in not just coaching the team and making sure the first team remains competitive, but also looking at the longer term picture around the way the game is changing and adapting , which helps us stay competitive.” “Over the next five, 10, 15 years, growing players for both the men's team and the women's team, we always had success, players throughout the program “to produce,” added Feist.