England were stunned 30-12 by Tonga in Perth on Saturday even though the Pacific islanders lost star halfback Latu Fainu to a pectoral muscle injury early.
They now face an uphill battle to make the semis, with only two of the six nations across Pools B and C in the 10-team tournament progressing to the final four.
England have reached the penultimate stage all seven times they have competed before as a separate entity, as opposed to Great Britain, at the global showpiece.
"I could look at the points, I could look at the points difference, I could start working out the strategies," said McDermott after his first match in control.
"The roads will lead back to us winning the next two games and winning in a strong way. I understand the need to do that."
World number three England need Tonga to beat Samoa on November 1 while they pile on the points against Papua New Guinea and France to stand any chance.
"We've got to improve upon the things that we know we've got to improve upon but again, I've seen enough that's telling me we're heading in the right direction," he added.
"All we can do right here, right now is go out and put in a tonne of effort."
It was Tonga's first-ever win over England, considered a top tier nation, courtesy of a defensive masterclass in the four-tries-to-two victory.
Coach Kristian Woolf said it was indicative of how far the team had come.
"I just thought the longer the game went, the better we got," he said.
"It's a big thing to get up and beat tier one nations. It's only happened a few times and we've been a part of a few of those really big wins and this was another one. We're really proud."
Tonga travel to Sydney for their next match against Lebanon on October 23 while England remain in Perth for a clash against France a day later.
