The 55-year-old was sacked on December 22 with Palace placed 17th in the Premier League having won only one of their last 11 games.
"Looking back, I sat down with Steve in the summer and we decided we wanted to take the club forward," he told the Times. "We made changes but I definitely have the view we didn't change the squad enough.
"We brought players in but I think we should have done more. That was compounded when we thought we had good cover at left back, not thinking Pape Souare would be in a car crash. That was a big mistake not getting cover in one or two areas.
"Sometimes as manager you do get loyal to players. They kept us up, we got to the cup final. I couldn't fault their attitude but we didn't have a balanced team.
"The players I've had, I think I've largely got the maximum out of them but maybe you can't keep going for maximum. Maybe my loyalty gets in the way a little bit. I have been loyal to a fault with some. That's just a trait I have. Something I have to keep an eye on."
Need a VPN? Or seeking to switch? Then support Tribal Football by clicking here to sign up with our official partners NordVPN. Not only will you receive the best VPN experience, but also great discounts by signing up via Tribal Football. Thanks for your support!