The 32-year-old signed a contract with Bolton after leaving Liverpool but had a change of heart and opted for a 2-year deal with City instead.
Hamann won the German title and the UEFA Cup with Bayern Munich and went onto win both the UEFA Cup and Champions Legaue with Liverpool, as well as helping Germany to the 2002 World Cup final.
"He's achieved everything in the game that you could possibly want to, European Cup medals and international honours - he's got everything," Pearce told the City website.
"If you have got more winners like him in your squad, you are going in the right direction.
"When he came into training on Wednesday, he did not want any short cuts," he added. "We gave him the option of whether he wanted to take it easy with the running we had planned for the afternoon, but he did not take that option.
"That's the mark of the man, but I did not think he would anyway. I think we have a good acquisition here."