The Israeli international is saddened at the Spanish striker's incredible fall from grace following his move to Stamford Bridge two years ago.
Benayoun, back with the Blues after an injury-hit loan spell at West Ham, said: "It has been a hard time for Fernando. When he came to Chelsea he was on the bench, on the pitch and then on the bench again.
"So he didn't get the confidence he needed when he arrived. My opinion is that, from the beginning, the situation with him was badly managed."
And Benayoun added: "Fernando was the top striker at Liverpool, an unbelievable player. You gave him the ball and you knew he would score.
"But he had a bad time in the beginning at Chelsea because Drogba was here and there was competition.
"And with that £50m fee over his head - that's not easy for any player.
"This is the first season that the club has given him the 100 per cent confidence that he needs to be the number one again."