The Reds were held to a 2-2 draw by the Championship side at Anfield before they earned a 14-13 triumph on penalties in the third round.
Despite sealing their progress in the competition, Thompson believes that the Merseysiders failed to inspire with their display.
"I would like to say that it was a marked improvement, but that would be far from the point," he told Sky Sports News. "There were a lot of good performances, but in the final third you needed the ball to be moved quicker. I don't think that happened."
Liverpool return to Premier League action on Saturday when they entertain local rivals Everton.