The South Africans imploded under the pressure of Ricky Ponting's team to lose the second Melbourne Test by 184 runs in the over after lunch on the final day, but Smith urged his troops to come back hard in Sydney next week.
"If anything, we need to pick it up and step up our ruthlessness on the field. We need to finish things off," Smith said.
"We've discussed that and we must relax and let it happen. We may just get a bit tense, and that comes down to inexperience, playing the best team in the world. It's the first time to play in Australia for a lot of our players."
The series has been competitive and confrontational, but Smith said there was no bad blood between the two fierce rivals.
"It's not bad blood, it's just very competitive and it's always going to be. Both teams are playing the game very hard and very tough," Smith said.
"For the first time in a while, Australia is seeing a competitive series at home. Everyone has taken to it. Everyone is lifting their game.
"There's always a lot of heat on the ground. There's always going to be tense moments and maybe heated moments, but I think that's what people would rather watch."
Smith is promising no let-up in the intensity, with team coach Mickey Arthur saying that Australia's champion leg-spinner Shane Warne is a master at pressuring umpires in his appeals for a wicket.
But the skipper rued his team's missed opportunities. Andre Nel put down Ponting on 17 before he went on to make 117 and Mike Hussey was grassed by Jacques Kallis on 27 before he finished with 122.
"Both guys we put down in the first innings went on to make hundreds. We really had the momentum and Mike Hussey's hundred at the back (of the first innings) took it away from us," Smith said.
"But their batsmen made the most of their opportunities, and credit to them.
The Proteas will be without their front-line fast bowler Makhaya Ntini for the Sydney Test after he strained knee ligaments during the Melbourne game.
Smith said he had been disappointed with his form opening the innings with AB de Villiers, with scores of 34, 30, 22 and 25.