In an interview on Friday, the Lothian Region MSP promised to champion strong policy reform, strengthen its base in Edinburgh and re-energise the labour movement.
But the 34-year-old, who could become the party 6th leader in just seven years, admitted that winning back over the 50% of Scots who voted SNP would not be easy.
Dugdale lines herself up to succeed Jim Murphy
"Our problems are long in the making and won’t be fixed overnight," she told The World at One.
"I’m standing because I want to change my party and get fit for the challenges ahead."
Acknowledging the scale of Labour's defeat, she admitted: “Nothing we can say or do will disguise that fact.
"The job of our next leader isn’t to explain away that loss or find excuses – it’s to understand why people were so reluctant to vote for us and find a way of regaining the trust of the people of Scotland.”
The 34-year-old would be one of the youngest Scottish Labour leaders
Asked about what changes she bring to the leadership role, Ms Dugdale responded: "Less anger, more good humor, being more in conversation with the people of Scotland and with a driving sense of purpose routed in Labour values."
The Aberdeen University law graduate insisted she was "proud" of the 2015 election manifesto for having been "routed in working class values", but admitted it would be a struggle to win over those who deserted Labour.
"I see the Labour Party as a great crusader," she aid.
"It's been the vehicle for social change and it will be again - but we do need to change it."
Ms Dugdale is the first to formally enter the race to succeed Jim Murphy, but party officials confirmed it would be two months at least before a new leader was chosen.
Whoever takes up the Murphy mantel will have a large task on their hands, with elections to the Scottish Parliament in Holyrood due to take place in May next year and the SNP insurgence showing no signs of waining.