Widely regarded as one of the greatest managers of his generation, Pep has won eight major trophies since taking charge of City in 2016.
Marsh spent four years at City from 1972 and worked under legendary managers such Malcolm Allison, Tony Book and Sir Alf Ramsey on a domestic and international front during his career.
But he feels the Spaniard’s ability to get the best out of his players, as well as his spectacular football brain, puts him top of the tree.
“I played with some great managers, some great coaches in my career, including Sir Alf Ramsey,” Marsh reflected.
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“But Pep Guardiola is the most astute, understanding, his attention to detail, adjusting to situations that arise, he’s a tremendous psychologist.
“I don’t know if he has a background in psychology but he seems to do and say all the right things all the time.
“He’s turned John Stones around.
“I never thought John Stones would become the player that Guardiola has made him into so I have nothing other than tremendous respect from Pep.
“I’m a huge fan of Pep Guardiola, and what I love about him now is he’s… now got this sense of humour where he says something and he’s got a little wink in his eye, I love that.”
While the boss was hugely successful at both Barcelona and Bayern Munich before joining City, there were questions as to whether his methods would transfer as effectively to the rigours of the Premier League.
But Marsh is particularly impressed by the manner in which Guardiola has passed that test with flying colours, suggesting he might have even subtly adapted his style to suit the English game.
He said: “It’s a very difficult place to play because you can go and play an away game to a team at the bottom and they can be dangerous.
“Maybe you’re playing in France as an example, and Paris Saint Germain, they blow lower teams away and seldom get in trouble.
“Whereas in the Premier League… you have to win the game, you don’t just go out there and play.
“I wonder if Pep, when he first got to Man City realised very quickly ‘I’ve got to be on my game because every game is a struggle’.”
In his heyday, Marsh was renowned for his flair, creativity and flawless technical ability - akin to our current crop under the watchful eye of Guardiola.
And while he insists winning was always at the forefront of his mind, the former City forward also emphasised how important it was throughout his career to be inventive and take risks.
“I loved to play the game, I was born to play the game,” he reflected.
“I loved entertaining the fans, I loved trying things with difficult shots, bending the ball and trying to score goals that hadn’t been scored before.
“Trying outrageous things like trying volleys from 40 yards and things like that as an example.
“I tried to do a lot of things so the fans would get excited.
“I always wanted to win but I always wanted to entertain the fans and play great skilful flair football.”