The Stags finished fifth in the Plunket Shield four-dayers and last in both limited-overs competitions this season, a disappointing result for the South African native Malan, who took over from Alan Hunt this summer.
Malan starts his season post mortem and player reviews this week, and said he would have to be honest about things with the players.
"Performance justifies selection, not just talent," he said. "There's going to be a couple of harsh words spoken in between."
Malan said it had been a strange season and he wasn't content with the results, but was happy with the feeling within the team. "I think when we look at it from a performance point of view, we're a long way off where we want to be."
CD had two wins and six losses in the one-day competition, seven losses and three washouts in the Twenty20 leg and two wins, five draws and three losses in the Plunket Shield as defending champions.
Malan pointed out they were a young team who were getting used to the rigours of first-class cricket; he just has to make sure they prepare properly.
"It's one thing having a game plan and chatting about things, but it's a whole different ball game once you get across the line, doing it against quality opposition.
"All the guys that have done well against us have been playing for the Black Caps in the last 18 months."
In two or three years he hoped their young players would be pushing for New Zealand spots.
One problematic area was runs at the top of the order, as they lost regular wickets against the new ball, and it cost them a lot.
By the end of the season, Manawatu players Dane Cleaver, Dave Meiring, Roald Badenhorst and Bevan Small joined regulars Adam Milne, Jamie How and Tarun Nethula in the team at some stage.
"They slotted in nicely," Malan said. "They got the opportunity to play and showed they're not far out of their depth.
"It comes down to a little bit of experience and feeling comfortable in first-class cricket. So there's still a couple of areas [to work on], especially from batting and fielding point of view."
