Jose Mourinho doesn't usually do third seasons. He tried it once at Chelsea and it ended in a breakdown of relations with his employer and the sack. Likewise the manager-mulching machine at Real Madrid likes to be fed at least once every two seasons. Mourinho is the first coach to get a third term in 10 years.

Both sides are on unfamiliar territory and the fragile pact between them is held together by one thing and one thing alone – the Champions League.

A dressing room divided between those who share the manager's agent Jorge Mendes and those who don't; a draining summer taking its toll on international players who Mourinho believes have yet to focus on the new season; and being two points from the drop and eight points from Barcelona in La Liga are all dark clouds that will be blown away by victory tonight over Manchester City in the only competition that really matters this season.

Madrid want to be the first club to win the European Cup 10 times. For too long now they have lived off the "best club of the 20th century" honour bestowed on them by Fifa in 2000. A decade of underachievement and, more recently, Barcelona's domination have left them needing a new boast that doesn't rely on the deeds of the last century.

Milan and Liverpool are the clubs closest to them in the league table of holders but neither looks likely to lift the prize again in the near future and of the sides set to threaten over the coming seasons two – Paris St-Germain and City – are yet to get off the mark. Madrid could be up on the podium on their own for a good few years.

Mourinho turned the liner around in his first season, radically transforming training techniques and the club's structure. He beat Barcelona in the 2011 Spanish Cup convincing everyone to stick with the programme and sure enough last season Real toppled Barça in the league and as a consequence his contract was extended.

The momentum would surely now take Real Madrid to their 10th European Cup and Mourinho's third. Had last season's semi-final legs against Bayern Munich not been either side of a crucial league encounter with Barcelona they might even have reached the summit then.

But the famous third season – only Mourinho's second crack at taking a team beyond a second campaign – has started disastrously. Last season it was December before the team had dropped eight points, this time they are already there.

The team is averaging more shots per game than last season but fewer of them have been on target. Karim Benzema has not scored since last season and is the butt of Barcelona supporters' jokes that even Javier Mascherano (with one own goal) has scored more. Cristiano Ronaldo is unhappy and Gonzalo Higuain has lacked focus, too.

Defensively Real look like conceding at every corner. Coming for high balls has never been Iker Casillas's strong point and with defenders failing to do their jobs, goals like the one scored from a corner at the start of Saturday's defeat to Seville have been commonplace.

But there are problems that run deeper. Mourinho shares an agent with four first-team regulars and there is a feeling in the dressing room that it compromises his judgement.

Would he have spoken out with more conviction over Ronaldo's selfish boat-rocking last week, or Angel di Maria's complete failure to pick up his man for that early Seville goal were both players not represented by Mourinho's agent Mendes?

On the other side of a dressing-room divide are the Spain internationals. Three of them – Sergio Ramos, Alvaro Arbeloa and Xabi Alonso – were all promoting their new boots last Thursday just a day after returning from international duty and just two days before the Seville game. Mourinho's complaints that certain players are not focused has been interpreted as a finger pointed their way.

The players in turn are unhappy at his public criticism. Ramos said it was "strange" that Mourinho should be quite so hard on his players after just four games. Many of them feel pre-season in the United States at Mourinho's favoured training camp has not served the club's needs. They also know that in any popularity competition, their feats for the national side would see them beat Mourinho every time.

There are also complaints that having disposed of sporting director Jorge Valdano, Mourinho has created a charisma vacuum at the club not properly filled by the unconvincing Emilio Butragueno. Part of Ronaldo's moan 10 days ago was that while Barcelona's stars were accompanied by their president Sandro Rosell to Monaco for the Champions League draw and the unveiling of the European player of the year (won by Barça's Andres Iniesta), Real sent a low-ranking board member. While Butragueno, the curiously titled director of "institutional relations", tagged along, he was accompanied by his wife and not on hand to offer the heavyweight moral support Ronaldo wanted. Mourinho had hoped Zinedine Zidane would fill the void left by Valdano but it seems the Frenchman is not keen on being Jose's spokesperson and has taken a step back from the limelight.

All of these problems will be forgotten with a masterful Champions League group phase but Mourinho has not been helped by the draw which pits his side with City, Borussia Dortmund and Ajax. "It is not normal for the champions of the three strongest leagues in Europe to all be drawn in the same group," he said. He has emphasised the long-term effects of such a difficult group leaving his team with more suspensions and injuries than any potential knockout stage rivals who have had an easier path to the last 16.

City also have players who have an added incentive to put one over on their rivals tonight. David Silva was passed over by Real several times before he eventually moved to England; Javi Garcia is one of a crop of talented youngsters produced by Madrid but never given a chance; and Mario Balotelli comes up against the coach who as good as told him he wasn't worth the trouble.

Head to head: Mourinho 1-0 Mancini