The keeper, who played for both sides in the city, believes that the poor campaign can be attributed to the Italian after a season of publicly criticizing his players.
The 'Great Dane' believes that the Italian's public criticism of his players has been a key contributor to the disappointing title defense this season, and says that it is something Sir Alex Ferguson would never do.
Mancini has been particularly vocal when criticizing the likes of Joe Hart, Samir Nasri and club captain Vincent Kompany in recent weeks, and Schmeichel thinks it has affected the team’s performances.
"You will never see United manager Sir Alex Ferguson in the media taking problems he has, or the squad has, or the club has, into the open," Schmeichel told Sky Sports. "Never ever. But you do see that at Manchester City.
"Some players have been heavily criticized by the manager in public. Perhaps Mancini brings that from Italy. Perhaps you do that there, where there are different expectations. But that does not work here. I can understand that some of the players have been angry or disappointed with that type of treatment. Sometimes they will take that on to the pitch and maybe not play 100 percent for the manager."
City goes into the derby 15 points behind its neighbor with the title all but heading back to Old Trafford. And Schmeichel reckons City as a club has struggled to deal with the pressures of being champion and competing with United.
"When you talk about Manchester City struggling to compete with Manchester United - and that's what it is, the gap is 15 points, so that's struggling - it's all about the whole football club," Schmeichel said.
"At Manchester United you can have a bad day and the supporters understand. Even in a crunch game you can have a bad result and they still back the team. That's a very big difference between United and most other clubs, apart from maybe Arsenal."