The French boss handed the Kop hero the captain’s armband in 2003 and has now entered the debate surrounding the 36-year-old’s future in the game, report the Liverpool Echo.
Gerrard is now an under-18s coach back at Melwood and has been told he can replicate Real Madrid chief Zidane’s swift route to the top of the game in management.
The France legend cut his teeth with Los Blancos’ B-side, Castilla, and led the Spanish giants to their 11th European Cup last year after replacing Rafa Benitez midway through the campaign.
“What I would advise Stevie is to do the different steps,” Houllier told talkSPORT.
“Zidane is at the moment in charge of the Real Madrid team, but before that for four years he coached the youth, then the reserves, then he became an assistant manager to Carlo Ancelotti.
“Then he went back to the reserves, and then he was ready. At the same time he took his qualifications, so he prepared himself.
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Houllier led the Reds to a treble of the UEFA Cup, League Cup and FA Cup in 2001, and he tipped Gerrard to replace current boss Jurgen Klopp in the Anfield hotseat.
He added: “You’ve got to be patient. You can’t step from players’ life and players’ activities to coaching.
“If he is patient and does the various steps then maybe he will be the next [manager] after Jurgen Klopp.”