I believe you drastically underestimate how much such a set up of those proportions costs. Your comment about not appearing to have been a high level of investment alludes to it but the figures required are way above what we got for those seasons in the prem.
But, hey, DoF

Also, which smaller clubs have passed us by?
It can be done on a moderate budget and creatively with the right structure, it comes down to where you decide and spend your resources and thinking long term. The strategy and planning is needed, hence the need for DoF or technical director. Leaving it up to a manager who lasts around 18 months on average and his mate as a scout is hardly a strategy for long term recruitment and succession planning.
Smaller or similar sized clubs that have passed us by....Brentford, Bournemouth, Burnley, Crystal Palace, Brighton, Ipswich, Nottingham Forest.
Leeds are a much bigger club than us, but we had a year head start on them in getting to the Premier League, even then, look at some of the players they unearthed from beyond the British isles.
The most glaring issue at the club is the recruitment of players, lack of long term structure, lack of overseas scouting, and over the past 7 years a lack of investment in the space. I don't see how that is even a debate, its clear for anyone to see. Hence why we have such an average squad.
Every top club in the world and pretty much every top flight team has some form of director of football or technical director. We still haven't managed to even get that in place.