The Blues are seeking a new man at the helm following Carlo Ancelotti's exit at the end of the Premier League season.
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Hiddink, currently coach of Turkey's national team, worked at Stamford Bridge for four months until May 2009 and helped the Blues win the FA Cup final.
The Dutchman is among the bookies' favourites to succeed Ancelotti and Malouda for one would love to have him back.
'I have a lot of respect for him,' he said. 'When he came we were in a difficult situation in terms of results.
Old pals: Hiddink pulls Malouda to one side
'He brought back confidence, I think. He improved our game and led us in the Champions League and FA Cup.
'He put the club back on the right way. It was short term. It was really quick, but it was really intense.
'You have to take your time to make the right choices and that is what the board is doing.
'I think we have a strong squad and when you want to add an ingredient to the squad you have to take your time.'
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