I don't know who decided (between Perez and Ancelotti), but Real Madrid made a mistake by being stingy with their spending last season, and they underestimated the conditions they are facing. They have the opportunity to bring in new players in the January transfer window, but they didn't take advantage of it, though they still have enough budget to spend.
Real Madrid management is very conscious about spending money. Madrid management does not spend money unnecessarily. Madrid did not spend much money to add new players to the squad last season. There were enough reasons for this.
Madrid played great last season. The team was strong in attack, defense and midfield. This season Madrid strengthened their attack even more by adding Mbappe. The midfield and defense remained unchanged.
Madrid's defense was also strong this season. Madrid faced big problems because several defenders got injured at the same time. This was Madrid's misfortune. Madrid's squad is still very strong.