postponement of last week's derby was hardly the ideal way to start his first calendar year in charge of Edinburgh but it has done nothing to dilute the optimism of David Davies, the managing director charged with overhauling what had become a dysfunctional organisation.

Few would have believed, as this season began, that it would be his club rather than Glasgow who would be carrying Scottish hopes into the fifth and penultimate round of Heineken Cup pool matches this weekend.

This turn of events, brought about by an unexpected victory at Gloucester in their last outing, is something to be savoured as Edinburgh await the visit of French side Perpignan this weekend.

Davies balances the excitement with just enough realism to offer a reminder that this is a veteran sports administrator who knows better than to be overcome by hubris and start making rash projections.

"We all recognise that Perpignan on the road represent a different proposition from Perpignan down there while the way of building a European campaign really is a game at a time," said the former Queens Park Rangers and London Wasps chief executive.

"We didn't make it any easier for ourselves by losing at home against Gloucester but we're going to be a handful for them and it will also be interesting to see where Perpignan put their emphasis. We also believe, though, that, if we turn up, we would really be in a strong position but the uncertainty is a recognition of where we believe we are."

The situation is delicate because, on the one hand, the nature of sport means Edinburgh must seize what remains of a rare marketing opportunity for a Scottish professional team, but, on the other, must learn from the mistakes made in 2012 when they reached the semi-finals.

"There is a danger that if we over-perform at this stage, expectations are raised unreasonably," Davies observes. "That was one of the problems that was caused by reaching the European Cup semi-finals two years ago. There was a jump in season-ticket sales and interest from sponsors but the reality was that we were 11th in the league that season and 10th the following year. As soon as that became a reality for the season- ticket holders and the sponsors then it had [the opposite effect].

"We are crucially aware that we will have to manage season ticket and sponsorship expectations if we do get further in Europe because the league position doesn't lie. It tells you in reality where you are. Michael Bradley [the coach who took Edinburgh to the semis] had a team that was 10th and 11th in the league but we are currently around sixth so if we were also to get to the knockout stages in Europe that would be a different reality."

They will only do so in the Heineken Cup if there is a freakish sequence of results over the next two weekends, but getting through to the Amlin Challenge Cup quarter-finals is still just about within their own control.

More important than either, though, is the confidence that is growing within the organisation as a whole that the right structures are being put in place for sustained success. Davies knew a crucial consideration would be the relationship forged with the new head coach, the appointment of whom was a priority when he took over in April with the team under caretaker control.

In Alan Solomons, who has experience of the Heineken Cup, Celtic rugby, the English Premiership and Super 15 rugby, Davies finds himself dealing with someone with whom he can work well. "Any time you get a new MD and a new coach you hope the chemistry is right and we get on with each other. It becomes a lot easier to make decisions around recruitment and the way the club generates a culture," he explained.

"It maybe helps that he and I are roughly the same age, but the chemistry through all of the senior staff at the club means that I think it is a good environment for the players to come into."

What breeds confidence is that, having explained to the players that they were behind on some fundamentals in terms of conditioning at the start of the season and so faced a difficult programme in seeking to catch up, the results have been almost exactly in line with what Solomons told them they could anticipate if they applied themselves properly.

Just as management of expectation is important for the squad, though, it is important for the wider rugby community to understand what confronted them.

"When I came in and spoke about this for the first time I said it would take a couple of years to get us where I want to be," said Davies.

"A season-ticket holder asked me at that stage where I thought we would finish at the end of the season. I said at that stage that there were five teams that were away from the rest at the moment, the three big Irish provinces, Glasgow, who have a quality squad and are maybe not doing what they would like to at the moment but I still think they've got everything they need to be a play-off team, and the Ospreys.

"I felt that at our stage of development we were in the next group just behind them, so consequently my first target was to be between eighth and sixth. My view is that's still where we'll be but I'd like to think we'd be at the top end of that."

While the standard of player at Edinburgh is much higher than results since their Heineken Cup semi-final appearance would suggest, recruitment and retention of leading players is a crucial element in moving forward but also, Davies believes, a barometer of what is happening.

"What I think is more telling than anything else is the way the Scottish players have reacted to Alan which you can measure by the number of players who are re-signing. He has brought a discipline and method of play that may not have everyone's juices flowing but is effective and that is what the players want to be."

"We wanted to do our business early and that made it important that the players who are here are buying into the quality of the coaching team. That's not going to guarantee we'll be up there immediately but we want to ensure that next season no-one will come to Edinburgh and get an easy time. It is about being competitive and we know there's a process in place.

"We were starting from a position of almost rebuilding the club so we started the process of discussion early with a number of players at that stage. We're pleased with how things have gone so far but we recognise we've got some way to go."

What happens over the next fortnight may offer further encouragement, or a further reminder of how much work there is to do but, either way, Edinburgh look a lot better placed to deal with it than was the case two years ago.