The 2022 World Cup semi-finalists will likely be eliminated unless they beat the reigning champions in Leipzig following a 3-0 defeat by Spain and a 2-2 draw with Albania.
Croatia's midfield dazzled in Qatar and in 2018 when they finished as runners-up in the World Cup final, but Kovacic, veteran Real Madrid star Luka Modric and pivot Marcelo Brozovic have underperformed this summer.
"Of course we do speak to one another, and we know that our midfield unit has not operated as well as in the past, we haven't been as compact as normal and our team play as a whole has suffered because of that," Kovacic told a news conference Sunday.
"We weren't up to our usual standards in the first two matches but we have a third game coming up.
"We're up against an excellent Italy team and with greatest of respect to them, I believe we can approach the match (in the right way)."
Modric, 38, won La Liga and the Champions League with Real Madrid but has been far below his sparkling best.
Brozovic now plays in Saudi Arabia for Al-Nassr and has suffered heavy criticism in his homeland for his shaky start in Germany.
Kovacic said the team were not thinking about the chance that the Italy showdown could be Modric's final match in the red-and-white chequered shirt.
"We're happy that he's here with us again this year and we will show what we can do," continued Kovacic.
"We're delighted to have Modric with us out there on the pitch.
"We're entirely focused on Italy, we're not thinking too much about that stuff at the moment."
The 30-year-old Manchester City midfielder played for Inter Milan between 2013 and 2015, and said he grew in many ways in Italy.
"I learned discipline in Serie A both on and off the pitch," continued Kovacic.
"The tactical approach, how to defend, I learned a number of things from them and it stood me in great stead.
"I think you can learn a lot from Italian football, how to get your defensive shape, your position... I wasn't good defensively at that time so it really helped me to get better."
Italy lost 1-0 to Spain but beat Albania 2-1 in their opening game and a draw would be enough to claim second place in Group B behind La Roja.
"We know it's essentially a knock-out match tomorrow night, and there won't be any extra time. It's must win," said Croatia coach Zlatko Dalic.
"We need three points to go through, any other result sends us home, we don't want to go home so soon... Italy need a point and we need more than a draw."
