It is a fair question. As organisations invest more heavily in automation, analytics, AI, connected systems, and end-to-end workflow redesign, it can start to look as though a new idea is taking over: digital process excellence.

But operational excellence is not being replaced. It is being expanded. McKinsey’s current framing of next-generation operational excellence is explicit that the foundations still matter, while technology, digital, and analytics are applied to make operations faster, smarter, and more resilient.

That distinction matters. If digital process excellence is understood as improving processes through digital tools, better data, and more intelligent workflow design, then it is not a substitute for operational excellence. It is one expression of how operational excellence now has to work in a more digital environment. If, however, digital process excellence is treated as a new label that pushes aside process discipline, leadership, people capability, and continuous improvement, then it becomes a weaker idea, not a stronger one.

Why the question is being asked now

The reason this debate is surfacing is simple: the centre of gravity in process improvement is shifting.

For many years, operational excellence was commonly associated with Lean, Six Sigma, waste reduction, standard work, root-cause thinking, and performance management. Those methods are still important, but the operating environment has changed. Companies are now redesigning workflows around digital tools, AI, automation, and more connected decision-making. McKinsey’s operations work describes this broader shift as reimagining operations for productivity, resilience, and environmental sustainability, while its next-generation operational-excellence work says technology and analytics should accelerate the foundations rather than replace them.

At the same time, the European Commission’s Industry 5.0 framework has widened the conversation beyond narrow efficiency. It positions modern industry around human-centricity, sustainability, and resilience, not just digital capability or output speed.

So the real issue is not whether digital process excellence is replacing operational excellence. The issue is whether operational excellence is evolving fast enough to stay relevant in a world of digital workflows, AI-supported decisions, and more complex operating systems. That evolution is clearly underway.

What operational excellence still does that digital language often misses

Operational excellence is broader than process digitisation.

It deals with process design, but also with leadership behaviour, daily management, problem-solving discipline, workforce capability, cross-functional coordination, and the habits that make improvement sustainable over time. McKinsey’s description of next-generation operational excellence explicitly centers it on continuous improvement, high performance, shared values, and a broader organisational commitment, not only on technology.

That matters because digital process excellence, as a phrase, can sometimes sound narrower than it should. It often pulls attention toward workflow tools, automation logic, dashboards, and system-enabled efficiency. Those things matter, but they do not fully answer questions such as:

Who owns the process when trade-offs appear?
How are people developed to work inside the new model?
What behaviours sustain problem-solving when metrics worsen?
How is resilience maintained when systems fail?
How are sustainability and worker wellbeing protected while performance improves?

Those are still operational-excellence questions, and Industry 5.0 makes them even more important, not less.

What digital process excellence adds

That said, the digital side does add something important.

Digital process excellence brings stronger attention to workflow orchestration, automation, analytics, data flows, interoperability, and how manual and automated tasks fit together. Older McKinsey work on next-generation operating models described exactly this need: workflows should be orchestrated so that manual work and automated tasks are cleanly segmented, and organisation structures should reflect the skills and scale required in more digital environments.

In that sense, digital process excellence is a useful idea because it highlights something traditional operational-excellence programmes sometimes underplayed: good processes now depend on digital architecture as well as process logic. A process can no longer be considered excellent if its data is fragmented, its workflow is badly integrated, or its automation creates hidden waste. McKinsey’s technology-in-operations material similarly reflects the growing importance of integrated analytics and AI-powered technologies across the value chain.

So digital process excellence is not wrong. It is just incomplete when presented as a replacement rather than a development.

The real shift is from toolsets to operating systems

A better way to understand the change is this: organisations are moving from isolated improvement toolsets toward more integrated operating systems.

The strongest current thinking does not present digital and operational excellence as competing brands. It presents them as increasingly intertwined. McKinsey’s operations research describes organisations reimagining operations for flexibility, speed, productivity, and sustainability, while the World Economic Forum’s manufacturing commentary argues for integrating operational excellence with digital tools and sustainable principles to achieve world-class performance.

That is a more useful model than a simple replacement story. It suggests that operational excellence supplies the management discipline, problem-solving logic, and performance culture, while digital process excellence supplies better tools, stronger data use, more intelligent workflow design, and improved scalability.

When those are combined well, the result is stronger than either idea on its own.

Why replacement thinking is risky

There is also a danger in saying operational excellence is being replaced.

The danger is that organisations may start to believe process performance can now be solved mainly through software, automation, or AI. That is rarely true. Technology can accelerate a good process, but it can also hard-code a weak one. McKinsey’s next-generation operational-excellence work specifically argues that the foundations need to be revisited and strengthened even as digital and analytics are applied.

This is especially relevant in more advanced industrial environments. The World Economic Forum’s 2026 industrial outlook points toward collaborative multi-agent AI, digital twins, and coordination across lines, machines, workers, and partner sites. But that kind of environment increases, rather than reduces, the need for strong process ownership, resilient operating logic, and capable people.

In other words, the more digital the operation becomes, the more dangerous it is to lose the underlying discipline of operational excellence.

Industry 5.0 makes the answer even clearer

Industry 5.0 is one of the clearest reasons operational excellence cannot simply be replaced by a digital label.

The European Commission’s framing explicitly broadens industrial performance beyond productivity and connectivity. It stresses that modern industry should be human-centric, sustainable, and resilient. That means excellent operations must now deliver more than efficient workflows. They must also support worker wellbeing, broader stakeholder value, resilience under disruption, and responsible use of technology.

That agenda fits naturally with an expanded model of operational excellence. It fits less well with a narrow version of digital process excellence if that phrase is used only to mean smarter workflow automation.

So the future is not digital process excellence instead of operational excellence. It is operational excellence redefined for a digital, human-centric, and resilience-focused era.

What the future probably looks like

The most likely outcome is not that one term wins and the other disappears. It is that operational excellence remains the broader umbrella, while digital process excellence becomes one of its most important modern dimensions.

In practice, that means high-performing organisations will combine:

• classic process discipline
• continuous improvement habits
• data and analytics
• workflow redesign
• automation and AI
• stronger cross-functional integration
• resilience thinking
• people capability
• sustainability and human-centred design

That direction is consistent across McKinsey’s operations work, the European Commission’s Industry 5.0 materials, and the World Economic Forum’s manufacturing outlook.

Conclusion

Operational excellence is not being replaced by digital process excellence. It is being modernised by it.

Digital process excellence is useful because it highlights the importance of workflow design, data, automation, and intelligent process orchestration. But operational excellence remains the larger idea because it still has to encompass leadership, people, resilience, sustainability, and the broader management system that makes performance repeatable. McKinsey’s current view of next-generation operational excellence and the European Commission’s Industry 5.0 framework both support that conclusion.

The better question, then, is not whether operational excellence is being replaced. It is whether organisations are broadening operational excellence enough to include what digital process excellence now makes possible. That is where the real shift is happening.