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From the dicitionary

By 1989 it was clear that she was already on her way out.

I didn't get the point of this. Was the sentence talking about two women (she and her)? Couldn't you explain the meaning in more simple words?

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That example sentence follows the definition:

no longer successful, popular, or effective

Since the definition does not mention more than one person, the example sentence does not refer to more than one person. The point of the example sentence is to demonstrate how the meaning no longer successful, popular, or effective can be used in a sentence.

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No, they refer to the same person.

on her way out

is a phrase meaning your involvement or popularity was ending. For example,

She wasn't a very good teacher, and this year it was clear she was on her way out.

meaning that she wasn't doing a good job, and would likely be disciplined or fired soon.

This term can also be commonly used referring to show biz and politician popularity.

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