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Pursley, who spent 14 years as national team director of USA swimming, took on the British coaching role in October and has been tasked with leading the team in the run up to the London Olympics in 2012.
"The British team has not even come close to realising its full potential," Pursley said. "Right now the US is clearly number one, Australia clearly number two and then there are several countries vying for the third-place position."
"To separate ourselves from that pack and close the gap between one and two I think are realistic goals," he said.
"There is no question in my mind that the gap can be narrowed."
Pursley, who guided US swimmers to the top of the medals tables at three consecutive Olympic games in 1992, 1996 and 2000, admitted he was not particularly interested in the role when first approached about it.
"I wasn't looking for a change and when it was first brought to my attention there wasn't a lot of interest on my part," he said.
"But the more I thought about it the more it became apparent to me that there's really not a more exciting situation or opportunity in competitive swimming that there is in British swimming."
The British team are still riding high from last year's Beijing Olympics success, where they finished third in the swimming medals table, doubling their medal target to bring home two golds, two silvers and two bronze.
Pursley credited former national performance director Bill Sweetenham with turning the team around. Sweetenham, known for his tough coaching style, was appointed after the Sydney Olympics where British swimmers failed to win a single medal, but stepped down in 2007 citing personal reasons.
When taking up the role Pursley, who has also held senior coaching posts in Australia and Canada, described himself as an outsider looking in and said he would spend his first few months observing and talking with athletes and coaches.
"I could not be more impressed," he said of his time with the team so far. "The swimmers are focussed, they are committed. Within days or weeks after Beijing they were already refocused on London."


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