Coach Vern Cotter concedes his Blues face a "great little challenge" after the Super Rugby Pacific defending champions slumped to the bottom of the standings through two rounds.
The Highlanders halted an eight-match losing streak against the Blues with a 29-21 upset win in Dunedin on Saturday.
The home side fought back from 14-3 down and held firm in the closing stages despite playing with 14 men following a red card shown to prop Daniel Lienert-Brown.
Errors punctuated the Blues' game after the interval for a second-straight week, having also spurned a handy lead in their 25-14 opening loss to the Chiefs.
CAN YOU BELIEVE IT! 🤯
— Super Rugby Pacific (@SuperRugby) February 22, 2025
A remarkable performance by the @Highlanders sees them victorious in Dunedin 👏#SuperRugbyPacific #HIGvBLU pic.twitter.com/XHT8qtnyWA
Cotter said he won't panic and will ask his players to "reinstate some of the stuff" that worked well last year when they ended a 21-year title drought.
"You've got to take the emotion out of it and just become better," Cotter said.
"This is a proud group and it's a team that will want to do well - there's no point in standing up and yelling and screaming.
"You win together and you lose together, so this is a great little challenge for us."
Forward power was the heart of their 2024 success, but the Blues will be without one of their best big men for the whole campaign after test lock Sam Darry suffered a shoulder injury in the pre-season.
Former Scotland and Fiji international coach Cotter has chosen to field veteran All Blacks fly-half Beauden Barrett at fullback but admitted that could change when they face the Hurricanes in round three.
Barrett was outplayed by speedy Highlanders counterpart Finn Hurley, who scored tries on either side of halftime to swing the contest in favour of his team.
Highlanders coach Jamie Joseph said dynamic 21-year-old Hurley boasted "massive potential".
"Like all rugby players, he gets ahead of himself sometimes," Joseph said.
"But I'll let him go, I reckon, let him be himself and give him confidence. Luckily, he got it right tonight."
