As you say, the instruction is in binary format, say 100100111001110000000111111010101000000000 (I did not actually check the number of bits). Can you execute it ?
Well, not so easy, if you do not have somewhere a description of the instruction set, including the CPU architecture, and how it is encoded in binary. You have to understand how this sequence of bits is organized, what specifies the instruction, what are the arguments or registers involved, and that may depend on the instruction. Once you have sorted that information, you pass control over to the specialized circuitry that is supposed to actually perform the instruction, say an addition, with the data or registers you have decoded. For a different instruction, it will pass control (and data) to a different circuitry.
It is like team games. There often is one guy whose role is to dispatch the ball to the most appropriate player, after decoding what the next step of the game should be. Well, this is a bit far fetched. In the CPU, there is a specific circuitry that does it: it decodes instructions.