Xabi has just taken charge of the team. He played one official match at the CWC. Furthermore, some of the players who played there won't be with the team next year, such as Luka Modrić. Therefore, the Spanish manager will need to analyze the team thoroughly and manage Real Madrid in the best way possible to achieve success in the new year. I'm one of those who think Real Madrid will be successful next year. They can be ahead of Barcelona, but the players need to play with each other and build bonds, and of course, they won't have to waste too many individual chances like last year.
Xabi Alonso still has a lot of time to develop the Real Madrid team and from what happened in the Club World Cup I don't think it can be used as a reference because Xabi Alonso still needs time to adapt and also Xabi Alonso has proven that he is a quality coach when handling Leverkusen so the same thing is also possible for him to repeat again with Real Madrid.
I agree with you, that Alonso will definitely improve the team to perfection. I am not bothered about their defeat against PSG and I wouldn't use that to judge their performance next season in both Laliga and UCL, because there's enough time for Alonso to strengthen the team. Don't forget that some of these players were on injury and just came back, that will affect their performance for a little while.