Reds fans are excited about the potential of their current U18 team.
Dalglish said: "There are an awful lot of positives that have happened over the last couple of years (at the club), mainly from the Academy. I think the progress there from the young kids has been fantastic and it's really pleasing to see.
"As I've said before, it's great credit to Rafa (Benitez) that he made the changes there and brought in two Spanish lads and Frank McParland on the administrative side of it to get the Academy going, and that's really positive for us.
"But the most important team at a club is the first team and we've got to move that forward now. Hopefully it has moved on a little bit, but obviously we'd like to go further. For me, I'd be happy if we just made some progress."