Munster were beaten by a late Tim Visser try and a near flawless kicking display from Greig Laidlaw after the Irish outfit looked to have taken control after the interval, and now both Penney and Ryan say their side will be ready to respond in Round Two.
"Anything that could go wrong did go wrong. You have to give Edinburgh their worth, they played very well. But we were all over the place. We weren't good enough and that's something we have to address and rectify in time for next weekend's game against Gloucester," said Ryan.
"Any time you lose a Heineken Cup match, or indeed any match in a Munster jersey, you're disappointed and embarrassed.
"The intensity that we had against Leinster just wasn't there. We made too many basic errors: we knocked on, we missed tackles and took the wrong options. We were second best and can only blame ourselves.
"We need a response this week, but there's no point in bursting a gasket in training and not in the match against Gloucester. We need to focus on what went wrong, identify why it went wrong, and correct it.
"If we lose against Gloucester that will be it for our Heineken Cup ambitions. There is no room for error now."
Munster did at least head for home with a losing bonus point but Penney admits it wasn't good enough given that the 2006 and 2008 champions have qualified for the quarter finals in all but one of the past 16 seasons.
He knows that his side have already made life hard for themselves but he doesn't expect to see a similarly disappointing showing against Gloucester given what is at stake in Limerick.
"We're only looking from the outside in because you can't read what's in the mind of the players but it was certainly a malaise and a lack of spark there at half time," said Penney.
"That's massively dangerous from my perspective when you see that. The damage has already been done.
"That only comes from poor mental preparation. Our mental application was nowhere near what it needed to be.
"Nothing spurs a Munster man on more than an embarrassing performance."