It depends on the circumstances. Fortunately, in most cases, a properly executed power of attorney is sufficient to act for a person with diminished capacity. A power of attorney was signed when the individual did have the ability.
A power of attorney can be used for many purposes, including for purposes not involving capacity issues. So, it is vital to understand exactly what authority is given in the durable power of attorney. If a power of attorney does not grant all the powers needed in a given situation, guardianship or conservatorship may be necessary.
If a person is currently incapacitated and they have not previously signed a power of attorney, they likely lack the requisite capacity to execute one. As such, guardianship/conservatorship would be the only alternative.
Additionally, someone nominated as an agent under a medical or financial power of attorney may no longer be capable of serving. If a power of attorney does not provide for appointing a successor agent, a guardianship/conservatorship is likely the only recourse.