In an interview with The Guardian, Henry also says he had to change his own ways, which he described as "arrogant".
The culture that now drives the All Black side can be traced back to when Henry took over from John Mitchell.
Early in his All Black reign, which began in 2003, Henry said that senior players Justin Marshall and Carlos Spencer passed down punishments in a mock court and that "almost everyone ended up blind drunk".
Henry met with assistants Steve Hansen and Wayne Smith, plus two un-named senior players.
"We agreed we had to move away from that macho culture," said Henry.
A three point plan was formulated - no mock courts, no more binge drinking, no women in the team hotel.
On his time coaching Wales and the British Lions, who he led on a divided and unsuccessful tour to Australia, Henry says: "I was arrogant, just so up myself. And it killed me.
"I realised then that I had to change. I couldn't carry on being the authoritarian coach and telling people what to do."
In 2005, Umaga - the great All Black centre and captain - met Henry over coffee and asked about his traditional team speeches.
"Are they for you, Ted, or are they for us?," Umaga enquired, a leading question. So Henry dropped a ritual he had held for 30 years of coaching.
"You spend the week before each game [transferring] the responsibility from the coaches to the players but then an hour before the game, there is a fella up the front telling them what to do."
He also re-iterated that captain Richie McCaw was right to ignore his instructions late in the 2011 World Cup final - McCaw refused to have the ball kicked deep fearing a French counter attack.
Henry believes English coach Stuart Lancaster pulled a "masterstroke" by dropping key back Manu Tuilagi after he was convicted of assault.
"It will tighten up the group, and they will play better for it," he said.
