Pakistan went down by three runs in a last over thriller in Dubai on Friday, handing England an unassailable 2-0 lead with the final match in Sharjah on Monday.
England survived Shahid Afridi’s blistering eight-ball 24 to defend a 173-run target.
Mushtaq, a former leg-spinner, said modern cricket requires fitness and better fielding which Pakistan need to improve before next year’s World Twenty20 in India.
“The modern cricket and it’s protocols have changed. We were sitting at number two in Twenty20 because we have skilled players but maybe we are lacking in fitness and fielding and if you analyse then it’s a fitness game,” said Mushtaq.
“The team management has to take responsibility. You have to face the reality that you have to raise your game and as coach we have to lift the performance.
“If a player is not fit but is skilful then in today’s game you need fitness more and if after taking double runs twice and you can’t hit a boundary off a bad ball then it’s a problem.”
If Pakistan lose the series 2-1 then they will join the West Indies and Australia in a three-way battle for second position behind Sri Lanka in the rankings on 118 points.
However, when the ratings are calculated beyond the decimal point, then Pakistan will be ranked fourth.
If England win the series 3-0, then they will jump to fourth position on 117 points, while Pakistan will drop to sixth position.
Mushtaq, however, blamed the poor system of domestic cricket in Pakistan.
“I think we try to teach them and give them full information but it goes down to the system, it’s a matter of our system which needs to be looked at.
“If someone gets to know in international cricket in which hand one should hold the bat and that you don’t have to look at the ball but at your partner when you take a run, then it’s quite a worrying thing.
“So we are doing our effort and the sooner we do this effort it’s better for the Pakistan team.”