On Friday, the Liverpool captain announced his intention to leave Anfield and move abroad at the end of the current season when his contract runs out, with a move to the MLS widely anticipated.
His decision brings a long-association with the club to an end but Houllier – who gave Gerrard his debut in 1998 – does not think he will be away from Liverpool for long.
"Stevie has done the right thing in having have a break from Liverpool," he told Sky Sports News. "He can do his qualifications and [then] I wouldn’t be surprised if one day we saw him become the boss at Anfield.
"He has always put the team first, so I wouldn't be surprised if he becomes a very successful manager."
Houllier went on to sing the praises of Gerrard, paying special attention to the midfielder's professionalism from an early age.
"I knew he wanted a new challenge, and he is at an age where has to look at his future," the Frenchman added. "He wanted to do something different, but he didn't want to stay in the Premier League.
"He is a kind-hearted, generous person and has a great personality and character. He was outstanding for Liverpool with technique, speed and power - he combined the three. You also need to remember the leader he was, he is someone who inspires, and people want to follow.
"We spotted him in a game for the Under-19 side, he helped them in a game, I saw him and asked to join the first team, we could see in training he was quickly developing. I played him at right-back at the start but his best position was always midfield.
"He devoted his time and energy for the job and that's why he was successful. He became world-class because of the sacrifices he made, he worked very hard to be successful.
"His character stood out very quickly, that's why I made him captain at 22."
