The former Norwich City boss brought seven new faces to Villa Park over the summer as he looks to build on last season which saw his side narrowly avoid relegation, finishing 15th.
Lambert has watched his men suffer defeat twice in their opening three games of the campaign, but he thinks he now boasts a much-improved squad.
"Competition is something we didn't really have last year," he told the Birmingham Mail.
"You need the competition because it is important and healthy for everyone at the club. We have that across the board now.
"In defence, for example, there are plenty of options with the likes of Jores Okore and Antonio Luna coming in over the summer.
"There's no doubt that the team from about February onwards were starting to click, you could sense that.
"We started to get results and the only ones to beat us were the top four. We've started well this season, too."