Dalglish returned to the Anfield dugout as caretaker following the departure of Roy Hodgson in January, with an impressive run of form taking the Merseysiders to the verge of European qualification, and earning the Liverpool hero a three-year contract.
McManaman was given his Liverpool debut by Dalglish back in 1990, and the former Real Madrid and Manchester City winger believes the 60-year-old Glaswegian will still be approaching the job in the same way he did during his first spell in charge.
"He has this great way of dealing with people. Whether it's the person who works in reception or the guy on the car park, everyone has a high opinion of him," McManaman told Liverpool's official website.
"Players love playing for him and he commands respect. He was a great player himself so he's been there and done it. He knows what works and what doesn't work.
"Kenny has also brought back the old Liverpool values which were so admired. Everything is done behind closed doors and what goes on in the dressing room stays in there.
"All that combined makes for a happy group of players and when you've got that you find they try more for the manager."
McManaman also dismissed concerns that Dalglish may have become a little rusty prior to his return to management in January, having not worked as a Premier League manager for more than 12 years.
"Kenny might not have been a manager for a long time but he certainly hadn't been out of the game," McManaman explained.
"I spoke to him before he got the job in January and his knowledge of football around Europe was fantastic. He was the logical choice for me - other candidates were not good enough or big enough to manage Liverpool Football Club.
"It's a huge club and it needs a huge manager. Kenny is the right man and despite all the advances in technology and sports science, there's still room for an old school manager.
"Kenny got the team playing. It was great to see and I really hope it's the start of a new era. People talk about cycles and Liverpool are on the way back up."
Liverpool will look to build on the successes of the second half of last season, and have so far appeared busy in the summer transfer window, signing Sunderland midfielder Jordan Henderson and chasing Blackpool star Charlie Adam and Aston Villa's Stewart Downing.
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