Maurizio Sarri has admitted Chelsea must "solve the problem" of Eden Hazard's long-term future.
Belgium star Hazard is out of contract in 2020 and Real Madrid have consistently monitored his situation in the hope of luring him to the Bernabeu.
Hazard boasts a league-high direct hand in 19 goals this term, and after netting a brace in the 2-1 win at Watford insisted he wants to become a Chelsea "legend".
Hazard then later insisted he will wait until the summer before resolving his long-term future, leaving Sarri to admit the Blues must now resolve the issue.
Asked whether he expects Hazard to stay at Stamford Bridge long-term, Sarri replied: "I don't know but I think that it's time to decide.
"I think that we have to solve the problem. If he wants to program the future, we have to solve this problem."
Asked if Sarri could resolve the issue himself, the Italian boss continued: "No, because I have not the power to do this.
"I am the coach. I am not the president, I am not in charge of the market, I am the coach.
"I want to speak to him only about the position on the pitch."
Hazard's match-turning showing at Vicarage Road on Boxing Day proved his abilities as a central striker once again.
The 27-year-old remains adamant he prefers to operate on the wing, despite Sarri recently deploying him as a 'false nine' through the middle.
When quizzed on his decision to shift Hazard into the centre, Sarri became frustrated and pledged to keep on fielding him where he sees fit.
"I cannot see the problem of Hazard in this role, he played four matches as false number nine, and he scored three goals and two assists," said Sarri. "So I am not able to see the problem.
"I am really very happy with him in this position because he's very able to score, first of all, but he's very able to open spaces for the team-mates, to come and play with the team-mates.
"So at the moment I am very happy with him in this position, but in the future he can also play as a winger of course.
"I don't know if he prefers to play as a winger or a striker, but if he is able to play in the last match in the centre for me it's not a problem to put him in the centre."
Chelsea will face Crystal Palace at Selhurst Park on Sunday, but must do so without Spain forward Pedro – and could also be without Callum Hudson-Odoi.
Both players were withdrawn against Watford due to hamstring injuries, with academy graduate Hudson-Odoi now battling to be fit for Sunday.
"We have two problems; most serious with Pedro, who has an injury in his hamstring that I think he will have to rest for about 10 days," said Sarri.
"With Hudson-Odoi, it's not a very serious problem but I don't know if he will be able to play the next match."