Transition metal oxides are excellent catalysts for selective oxidation reactions, which are a prominent source of industrially relevant chemicals. However, these reactions suffer from multiple competing reaction pathways, limiting the selectivity. Thus, it is essential to gain an understanding of the underlying processes occurring on the catalyst that affect its performance. Here we synergistically combine operando X-ray spectroscopy and operando transmission electron microscopy to unravel a network of solid-state processes that controls the catalytic properties of Co3O4 in the oxidation of 2-propanol towards acetone. These include exsolution, diffusion and defect formation, which strongly distort the catalyst lattice at lower temperatures. Ultimately, they also lead to a maximum in acetone selectivity when the catalyst is trapped in a frustrated or metastable state at the onset of crystallization of the exsolved particles to CoO and void formation, which coincides with the maximum in surface cobalt oxidation state in the spinel. The notion that catalysts are static entities that barely change under operation is still prevalent although it is often not true. Here, a range of operando and in situ techniques reveals the dynamic nature of Co3O4 during the oxidation of 2-propanol to acetone, unveiling a network of interconnected solid-state processes, such as exsolution, diffusion or void formation, that govern the catalytic performance.