The basic strategy of a phonics approach assumes that if you sound out the word and can hear it you will know what it means. For the most part it is an effective strategy and one that worked for me. On the other hand, those for whom it does not work, are called reading disabled.
The purpose of reading is to get meaning from the printed word. A phonetic approach requires you to look at the word and auditorize it (at least mentally) and when you hear the word, you will know what it means. This assumes that English is inherently phonetic and the reader knows the word to begin with. But let us accept the phonetic premise.
I learned to read in a phonics environment and fortunately it worked for me. But it does not work for everyone, so let us not mandate it for everyone. What alternative are there? One solution is a whole word approach, but the phonics proponents are wont to point out how the Chinese have to memorize 10,000 symbols rather than 26 letters. My first reaction is that the Chinese are a country with the largest population in the world, the fastest growing economy, and an impressive Olympic showing. They are not perfect...but they are patient. The Phonecians, on the other hand, have been all but absorbed in Lebonon. In Japan, children start out with phonetic Kana, but when they are ready to advance, they move to the pictographic Kanji.
That being said, let me assume there is validity in making a connection between the printed word and it sound. A phonics approach says let the sound be created by the student decoding. One alternative approach would be to pair the word with its auditory counterpart so the connection between the sound and the letters of the word are given to the student rather than requiring the student to produce the sound of the word.
Some students will learn to connect the printed word with its meaning better by speaking and phonetic decoding and others will learn better by hearing. The latter still teaches the connection between the printed word and its sound, but it does so by turning the standard phonetic approach upside down.
These two approaches will work best for students who learn best by speaking or hearing, but what about visual learners or those who learn by writing. There are as many ways to teach reading as there are people who want to learn to read. Phonics has its place as one of the ways to teach reading, but it should not be the only way. We cannot adopt a one size fits all mentality in Education.