Ole Gunnar Solskjaer says Manchester United need to strengthen this summer if they are to catch Manchester City after Tuesday's home defeat to Leicester saw their neighbours crowned Premier League champions.
The Red Devils wrapped up back-to-back top-four finishes for the first time since Sir Alex Ferguson retired with Sunday's 3-1 win at Aston Villa and just 50 hours later had to host Brendan Rodgers' FA Cup finalists.
Solskjaer made 10 alterations with Thursday's rearranged clash with rivals Liverpool in mind and Leicester edged out a 2-1 victory, with Caglar Soyuncu powering home a header after Mason Greenwood cancelled out Luke Thomas' superb early volley.
The Foxes' first league triumph at Old Trafford since 1998 saw City win the Premier League for the third time in four years, with the United boss saying investment is needed if they are to close the gap to their rivals.
"If you want to take up the challenge with them, of course, we need to strengthen our squad," Solskjaer told BT Sport.
"Congratulations to them. They've had a fantastic season.
"I'm very pleased with my boys because they've made it into the last 10 days of the season with a Man City team ahead of us that are lauded as the best in Europe.
"We've done well but we want to take the next step and it might be that we need a couple more to have a stronger squad."
Asked in the post-match press conference if he knows the areas he wants to improve, Solskjaer said: "That's a long process and we know what we want to do.
"First of all, congratulations to Man City for winning the league, very worthy champions. We've got to hold our hands up and say that.
"But that's where we want to be and we're not there yet. They've put the bar where it is and that's up to us now to take the next step."
Solskjaer was pleased with the performance of his much-changed side despite the defeat, with 19-year-old Anthony Elanga coming in for his debut on a night when 18-year-old Amad Diallo made his first United start.
"It took some time to get going but after they scored it looked like we dropped our shoulders, the nerves went and we started playing," the United manager said.
"We scored a fantastic goal and I'm very pleased with the performance. Amad, very good. Elanga will remember this, so very pleased with them."
Leicester manager Brendan Rodgers was thrilled with his side's display at Old Trafford, especially after Friday's shock 4-2 home loss to struggling Newcastle.
The victory propelled the Foxes back up to third and eight points above fifth-placed West Ham, putting them back on course for Champions League qualification as they now look ahead to Saturday's shot at their first ever FA Cup win against Chelsea.
"It's huge," Rodgers said. "It's huge. We get to 66 points now – two of the teams, third and fourth last season, qualified for the Champions League on 66.
"We've taken a big step, however, there's still two games to go, teams are still chasing us. There's still work to do but a huge step.
"It's amazing. We said when we reached the final there was still so much work to do for us in the league and we've done some great work to get to this stage.
"Now we can get back in tomorrow on the back of a fantastic result and get ready to take on the Champions League finalists.
"It's a chance for history at the weekend."