Saxon, well-known for its "incremental" approach to math education, uses the same method to teach K-2 phonics and reading. Using phonics rules and decoding (identifying sound-letter relationships), Saxon Phonics offers students the tools they need to become competent readers and spellers. While some parents might be intimidated by the course size and amount of "extras" (flash cards, charts, etc.), the teacher manuals are completely scripted for the instructor, making preparation and teaching time less threatening.
Teachers are encouraged to use fun activities and games to make the content appealing, with lots of suggestions in the teacher manuals. The worktexts are fairly bland with basic exercises and minimal illustrations, but the flashcards and any instructional creativity you add should balance things. The publishers of Saxon seem more concerned with insuring kids learn than giving them a good time, so while your kids might whine for more color and fun, if they apply themselves they will learn.
This is a teacher-intensive program (what phonics course isn't?) that will require your direct supervision/guidance at nearly every level. This shouldn't be too high a price to pay, however, for making sure your child can read well. Everything you need is included in the home school kit—various word and letter flashcards, word lists, audio pronunciation guide, workbooks and teacher's manual. These sets are a bit pricey at over a hundred dollars apiece, but you will require no outside sources or materials.
Each level has two consumable student worktexts. There is no student textbook, as all content is contained in the workbooks and teacher's manual. Students begin by learning consonant sounds, and move on to vowels and more complex parts of speech. There are several rules throughout for kids to memorize, and since this course is incremental (introducing and reintroducing topics consistently a little at a time until mastery is reached), they have plenty of time to grasp the concepts. This means there is also a lot of review, but not all bunched together; it appears in every lesson so students don't forget what they've learned so far. Exercises include fill-in-the-blank, word recognition, and matching.
The teacher's manual is indispensable. Apart from having answers to all exercises on reduced student worktext pages, the teacher's manual tells you how to teach this course, even providing exactly what you need to say for each lesson. Ideas for games, creative ways to present material, and suggestions for challenging the child to think independently are some of the many other features. While the complete scripting of each lesson does cut down on prep time, this is still a teacher-dependent and teacher-intensive curriculum that will require some work on your part.
This is one of the more expensive phonics curricula out there, but it is comprehensive and self-contained and genuinely helps kids achieve good reading and spelling skills. Parents who already have too much on their plate may want to opt for something a little less formal (like Explode the Code), though there isn't really a self-taught phonics program. If you want to make sure your child knows how to read and don't mind taking the time to teach him, Saxon Phonics is an excellent choice. Some parents think the pace is too slow, though you can modify the lessons to fit your child's aptitude and interest.
Some parents are overwhelmed by the size of the teacher's manual, though it isn't actually as daunting as it looks. Since everything you need to say to your child is included in its text, it's naturally longer than a teacher's guide that requires you to come up with a lecture. Lack of teacher support should definitely not be a problem here (a difficulty many have experienced with Saxon Math). Overall, you'd be hard pressed to find a better introduction to reading; after your kids have the basics down, where they go is up to you.