Lynch had his best ever season in the NFL last year and has already scored three touchdowns for the NFC West side in 2013.
Smith, who spent seven seasons playing for the Seahawks before taking up a coaching role with the club, told the team's official website: "Marshawn gets after it. He's a physical blocker.
"He definitely can get better, you're not going to deny that. But the effort is there, there's no doubt about it. The want-to and the can-do are there. But he can always do it better.
"If you're part of anything we're doing, you've got to be a complete back. If you go in there and you're a liability without the football, then you're a liability. So you've got to be able to do it with and without the football."
The Seahawks play the Houston Texans later today.