Alan made his first signing of the summer when he moved for James following the release of Pavel Snicek and David Forde at the end of the season.
"James is a goalkeeper that has played against my teams for the last four or five years and I have never seen him have a poor game," explains Alan.
"I think he is a player that has never really had the chance at a big club like West Ham, and I feel it is a great opportunity for him.
"He is at a senior age, but I was myself when I entered Crystal Palace and I believe that he could really push Stephen for that number one spot, and that is what you want - competition.
"He has been their player of the year God knows how many times, he has got them promoted a couple of times, and he is a good character - a winner.
"I think he will be a good signing for us, he accepts the challenge that Stephen is there at the moment, and that he is going to have to work hard, as I am sure he will, to dislodge him.
"That was part of the reason I looked at him and I think the type of person he is will help Stephen as well.
"He is a bubbly character with plenty to say for himself - in the nicest possible way - and I think that will rub off well on Stephen.
"Because he is a small built goalkeeper he has to dominate his box and be assertive, all those things I feel Stephen has not quite gained to the extent that James Walker has."
As for Steve himself, Alan adds:
"I think Stephen would be the first to say the final wasn't the best game he has ever had and he will grow from that.
"He has certainly played in some big, big games for us and been rock solid; he has earned the chance and the right to be the West Ham goalie for the next era, if you like.
"He has got the chance of doing that but only he will determine that; he has got competition now and he will have to come back and make sure he starts again where he left off."
Division One is to be known as The Championship as the Football League looks to raise the profile of the three tiers below the Premiership.
Divisions Two and Three will be re-named League One and League Two.