WALTER Smith stood steadfast, unblinking as the television lights illuminated a soulless corner of a stadium encased in crumbling concrete.

Rangers had just suffered their worst result in Europe and Smith was condemned to utter the instant analysis that the modern world demands. Failure signals a clamour that drowns out reason in the mass of observers, though the Rangers manager was dignified and honest. However, the defeat against FBK Kaunas was not an accident waiting to happen. It was a result that many observers feared.

In the aftermath of the draw against the Lithuanians in the first leg at Ibrox, I wrote that nothing had changed substantially in the most important areas of the team. Indeed, Rangers have regressed in the close season, partially because of injuries to Carlos Cuellar and Barry Ferguson.

The best result I envisaged for Rangers in Kaunas was a 1-0 victory, but two goals were lost from set-pieces and Rangers went out in pathetic fashion.

The club is now in crisis. This is not said in a melodramatic manner. It merely signals that crisis is always the prelude to change.

Smith inherited a dispirited, disjointed squad. He imposed a cautious style that produced spectacular dividends. Rangers won the Scottish Cup and the CIS Insurance Cup last season and reached the final of the UEFA Cup. They also posed a sustained challenge to Celtic in the league.

It was an outstanding achievement by staff and players in what should have been a transition year. But any hopes of progress on this foundation have collapsed before the domestic season has even started.

Form has been poor, team selection has been flawed, new signings have failed to deliver and the prospect now looms of Rangers having to sell Cuellar and Brahim Hemdani. If Rangers over-achieved last season, they have significantly under-achieved in the first, crucial test of the 2008/2009 campaign.

The defeat against Kaunas has financial implications. Smith's budget for recruits will suffer. Cuellar may have to be offloaded to "an offer too good to refuse". There certainly seems to have been contingency plans for this possibility. Rangers have as many centre-halves as they have centre-forwards.

The bright, shining concrete of a stadium in Falkirk now hosts a game of huge significance on Saturday. Rangers can only redeem themselves now on Scottish soil.

The players have to show the "pride and determination" that their manager insists was missing on Tuesday night. Smith must demonstrate that he can motivate the team and shape it to play in an enterprising manner.

Martin Bain, the chief executive, has to supply Smith with two creative midfielders. And soon.

The biggest challenge, however, may be for the supporters. This is Rangers' transition season. Fans raised on an expectation of success are not renowned for their patience. They will need that quality as their side takes faltering steps towards domestic respectability after humiliation in Europe.

The manager
Form
Smith's credentials are unimpeachable. Jock Stein, Jim McLean and Alex Ferguson employed him. His first season of his second spell at Rangers was remarkable because he inherited a shambles and imposed order. The next step was always going to be the most difficult.

Smith is a cautious manager. Though the romantics protest, he knows that results are the only true currency in modern football. This is not ice dancing. One does not get points for artistic impression. But artistic players can ensure that points are gained. Rangers need a more enterprising approach throughout the team.

Smith steadied the ship, until the sinking in the Baltic. He now needs to upgrade it substantially in its outlook, quality and ambition.

Must improve
He must have confidence in his signings and in youth. He may find it difficult to change but he must. An experienced coach can be suspicious of the caprices of talent but it must be allowed to fail, at times, so that it can flourish at crucial moments. His excellent relationship with the press should be used to inform the fans bluntly that this is a work in progress and things may get worse before they get better.

Selection and tactics
Form
Smith regularly plays one up front in important games. But so do Sir Alex Ferguson, Jose Mourinho and Phil Scolari. The difficulty for Rangers is that the side has little pace, scant creativity and no width. Nacho Novo was the only player who demonstrated these capabilities to any extent on Tuesday night.

The return of DaMarcus Beasley and Chris Burke will help in some regard. But Rangers need urgently to coach full-backs to venture into the final third. Sasa Papac did this on one occasion on Tuesday and Andrius Velicka should have scored to settle the tie.

must improve When faced with a choice between Kyle Lafferty and Charlie Adam, Smith must go for the former. He paid £3m for him and he has pace and a scoring record.

Steven Whittaker must make the runs that top-class full-backs consider the very staple of their trade.

Kevin Thomson must be played further forward until a playmaker, either Barry Ferguson or a new signing, is introduced.

Midfield players must accept that although trying to play the killer ball in the final third invites the loss of possession, that price must be paid.

The signings
Form
Smith has a poor record of late. Only Carlos Cuellar stands out as an excellent acquisition. Steven Whittaker has been a disappointment at full-back with poor distribution and an inability to reach the bye-line.

Kenny Miller is a puzzle. Respected observers insist he is an influential team player. Disrespected observers (me) see a centre-forward who does not score goals. He missed two crucial, excellent chances against FBK Kaunas.

The acid test is: with Miller through one-on-one on goal would you bet your house on him scoring?

Yes? It has just been repossessed.

must improve Smith has gathered an armoury of misfiring strikers and a plethora of pivots. He could play a team of forwards and a side full of defenders. Webster, Papac, Broadfoot, Weir, Cuellar and Bougherra are essentially centre-halves, though the Bosnian has filled the left-back slot gamely.

But Smith has failed to bring pace and flair to the midfield team. These attributes have a high risk factor. They cost a lot with no guarantee of success. The gamble must be taken, however. There is only one priority in recruitment: a midfielder of quality or even just one of promise.

The fans
Form
The chant of "We Are the People" does not suggest that the Rangers support is comfortable with the tag of plucky underdogs. Rangers supporters simply demand domination in Scotland and, at least, meaningful participation in Europe.

The departure from the Champions League precedes a season where Celtic will be bidding for their fourth consecutive SPL title. The supporters have already been vociferous in the their denunciation of the team, particularly of Miller. The opening moments of the match at Falkirk on Saturday will be a test. Will they rally or turn on their team?

must improve The fans have genuine grievances about style, selection and signings.

An articulate section of the Rangers support has been insistent in claiming that the club was, at best, treading water under Smith, even as Rangers reached the UEFA Cup final.

There is a painful dilemma for the disaffected. Do they barrack the team they love or do they vociferously offer support while quietly nursing doubts?

There is one certainty, however. This is a club with shell-shocked players. They need all the backing they can get from the stands.

The board
Form
Martin Bain, the Rangers chief executive, was mercilessly barracked on Tuesday night, both at the stadium and at Kaunas airport. But his problems run much deeper than verbal abuse. Rangers are in a financial hole. Exit from the Champions League merely exacerbates the problem.

Bain, too, does not have the relative autonomy of Peter Lawwell at Celtic. This is a club run by David Murray. Bain has to satisfy the financial constraints imposed by the owner and the demands of the manager. The supporters, too, will agitate furiously for more investment in the team. But Rangers have spent money on players. They need to do so again this month. These are busy and anxious times for Bain.

Must improve
David Murray has issued portentous statements to the sound of fanfares from his supporters in the press. There will be a new stadium. There will be a war chest for Walter. Murray is normally steady in a crisis and supportive of his managers. The fans must told unambiguously that Smith is the man to lead the club forward and that there is no moonbeam but only hard reality ahead.

The players
Form
If the players are not good enough, then that is the manager's fault. However, the most damning statement made in the wake of Tuesday night's defeat was Smith's quiet but intense lament at his players' failure to show "pride and determination".

Senior players have also spoken of some colleagues' belief they had "made it" because they were part of a squad that reached a European final.

Undoubtedly, there are players who must be replaced and others who must be informed that their designer jaiket is on a shoogly peg.

Must improve
Players must be told tersely that 100% commitment is the minimum required. The noise emanating lately from the dressing-room suggests this matter has been addressed by Smith. The players must accept that there is a responsibility in playing for a top club. Bravery extends to making the difficult pass and to making yourself available to a team-mate. There must be a desire to improve individually and collectively. The maligned Kirk Broadfoot may be limited but he is an excellent team-mate with a will to learn.

The players
Form

If the players are not good enough, then that is the manager's fault. However, the most damning statement made in the wake of Tuesday night's defeat was Smith's quiet but intense lament at his players' failure to show "pride and determination".

Senior players have also spoken of some colleagues' belief they had "made it" because they were part of a squad that reached a European final.

Undoubtedly, there are players who must be replaced and others who must be informed that their designer jaiket is on a shoogly peg.

Must improve
Players must be told tersely that 100% commitment is the minimum required. The noise emanating lately from the dressing-room suggests this matter has been addressed by Smith. The players must accept that there is a responsibility in playing for a top club. Bravery extends to making the difficult pass and to making yourself available to a team-mate. There must be a desire to improve individually and collectively. The maligned Kirk Broadfoot may be limited but he is an excellent team-mate with a will to learn.

The future
What could happen
Newcastle buy Cuellar, Hemdani finds another club and Rangers fail to acquire the presence they need in midfield. The struggles go on but Smith does not.

The protest from the fans becomes loud and insistent and the Rangers manager decides his situation is untenable. Celtic go on to win four in a row as Rangers undergo a meltdown of Paul Le Guen proportions. Only this time there is no Uncle Walter to turn to . . .

What should happen
Smith must dedicate himself to a more expansive playing style. There must, at least, be pace and width. He should admit his transfer errors and get rid of them. There must be a confidence in youth. Kyle Lafferty is his biggest signing and should play, particularly when the options are Charlie Adam or others who have been given a succession of opportunities.

John Fleck should be introduced, if only for an initial short burst, with other members of the under-19 squad that has been so highly praised. They are either good players or they ain't. Let's find out. Supporters should be told the blunt truth about the financial situation and of the club's goals, short-term and long-term.