The Premier League champions lost 1-0 to Borussia Dortmund on Tuesday, a result that ensured they would finish bottom of Group D on three points, even missing out on a Europa League spot.
They are also the first English team to go through an entire group stage campaign without picking up a victory.
"It hasn't been of a Man City standard this season so we are disappointed all round really," he told Sky Sports.
"We've adapted ourselves well at times but throughout the tournament we haven't consistently done well and it's not good enough.
"We need to continue to progress. Last year we made a good account of ourselves and were unfortunate not to go through, but this year it wasn't to be and next year should we qualify I'm sure we will be equipped to do better."