The 20-year-old has been predominantly used as a winger during his career to date, but City manager Manuel Pellegrini believes he can find a role for him through the middle.
Sterling signed a five-year contract with City earlier this week to complete his move from Liverpool
And Sterling has been challenged to continue his development at the Etihad Stadium after finalising his move from Anfield earlier this week before meeting up with his new team-mates on their pre-season tour of Australia.
"I think that Raheem can play in different positions - he can play as a forward because he has a lot of speed or he can play also on the wing," said Pellegrini, following Sterling’s first training session with the Blues on Friday.
"I think it's important for him to have a new challenge in our team where he will play with great players which will improve his game.
"He's a very young player so he has a lot of things to improve but he will also improve us as a team.
"I think that Raheem has already demonstrated what he can do as a player at Liverpool, but he's just 20-years-old so he has a lot of things to improve."
The former Queens Park Rangers youngster will not be involved in Saturday’s friendly against Melbourne City following his long-haul trip to link-up with the squad.
But he is likely to figure in their next game with Roma on Tuesday or the final match of their tour against Real Madrid next Friday.
And Pellegrini admits he is looking forward to seeing Sterling in action as City aim to improve on last season’s second-place finish in the Premier League.
"We must continue to have a competitive team," he added on MCFC.co.uk.
"I always say there are four or five important teams, so if you don't improve every year it's very difficult.
"It will depend how he works over the next few years but I am sure he will be very important in our team, especially for his speed."
