Captain Ben Smith said they were guilty of becoming frustrated at the interpretations of referee Glen Jackson and that the line speed of the Blues' defence rattled them further.
"We could have won that game at the end if we'd been a little more clinical in big moments," said Joseph.
"The Blues had the upper hand for that second half. I was pleased the way we rallied at the end and finished with 14 men, but not enough."
Finding that clinical edge will be the priority this week for the Highlanders, who face the Hurricanes in Dunedin next week.
Interest will be high, given these two were last year's finalists and the Hurricanes are much like the Highlanders in that there is now considerably higher expectation about their ability.
They were torn apart by the Brumbies in their opening game, when the greatest concern was their faltering scrum and lack of control and authority at the breakdown.
After what they achieved last year - finishing as top qualifier - they looked to have fallen a long way in Canberra and, if there isn't a big improvement in their next performance, the pressure gauge will turn again.
The Blues, in contrast, are for the first time in the professional age playing almost without any expectation of delivering.
So bad have they been for so long that no one has automatic faith in them anymore. Their fans have become conditioned to underperformance and calamity and have long stopped taking victory for granted.
Each victory they clock this year will be celebrated, met with genuine surprise. They are the new Highlanders, the emerging force of Super Rugby but without any pressure to prove it each week.
It can be an advantageous place to be psychologically. Externally, at least, there is only upside.
No one expects victory so, when it happens, there isn't widespread analysis or investigation.
This was much the same with the Chiefs in 2012 when they were as unlikely champions as the Highlanders in 2015.
"It's huge for us," said Blues coach Tana Umaga after the 33-31 defeat of the Highlanders.
"The pre-season is the pre-season but we gained confidence in what we're doing. The Highlanders threw things at us we hadn't seen. We were able to withstand some of it, and we were fortunate in other aspects. So we've got to learn from that."