A powerful tension is at work today in global economic sentiment. The financial markets, pundits, and policy makers think the global economy is out of the woods, but executives aren’t so sure. Our research suggests that the executives are right—and that to thrive, companies must adopt some new approaches to management.

In early September, McKinsey surveyed more than 1,600 business executives around the world about their current views on and hopes for the economy. Only 20 percent believed that a “normal” recovery starting in late 2009 would be the most probable outcome. Some 42 percent thought that 2010 would be a year of flat economic activity. About a third believe that an extended period of anemic global economic growth (below 1 percent per annum) is likely for the next several years. The remaining 7 percent felt that something akin to a double-dip recession was probable. (The full survey results can be found in “The crisis—one year on: McKinsey Global Economic Conditions Survey results, September 2009,” mckinseyquarterly.com.)

Simply put, the daily experience of business leaders suggests that a full recovery of economic activity to pre-crisis levels is further off than expected. Moreover, the distribution of responses suggests that, as a group, executives simply don’t know what will happen. An improving global economy is not the same as a recovering one.