Jim explains that the search committee recommended Robert California for the branch manager job. Upon being given the job and sizing up the situation, California immediately left the office, drove to Florida and convinced Dunder Mifflin Sabre CEO Jo Bennett that she should give him her job. He then went on to give the regional manager job to Andy Bernard.
Andy explains to camera that he feels honored to be the number one pick's number one pick for manager. He senses there could be some resentment from Dwight (another internal candidate for the job), so he's named Dwight his second-in-command. Smart to have him as an enforcer, Andy says. Dwight comments that he's worked through the resentment of not getting the job, upping his workout, fighting and meditation routines.
And there's more news in the office. Pam and Jim are expecting baby number two. And Angela has big news too: over the summer, she got married to the Senator - and the two of them are expecting a child. Angela wastes no time comparing herself to Pam, referring to her rival as "big pregs."
Much to Oscar and Andy's disgust, the office staff has caught the planking craze. Erin's not really sure what it's about but is excited to be in on it. We spot various staffers stretching out all over the office complex. Andy's had enough and tells Dwight, his enforcer, to stop the craze. Never one to miss an opportunity to assert himself, Dwight puts a stop to things quickly by tossing books, spraying folks with fire extinguishers and worse. Problem solved.
Jim explains to camera that the new CEO works out of the conference room about half the time. When he needs a break, the new CEO will take a slow wander around the office, stopping at the desk of one unsuspecting staffer for some uncomfortable small talk. He engages his latest target, Erin, asking about her day. They're interrupted by Andy who wants to follow up on his scheduled 9:30 chitchat. Robert California heads into Andy's office. As he walks off, California leaves a notebook behind.
Erin looks over the notebook and notices a ruled sheet of paper, split in half vertically. On one side, California has written the names Jim, Dwight, Oscar, Darryl, Andy, Toby, Phyllis, Angela and Kevin. On the other side: Stanley, Gabe, Kelly, Ryan, Old Man, Pam, Meredith and Erin. Erin doesn't know what to make of it and calls Pam over to consult, who then summons Jim over. They're perplexed and intrigued. Soon the whole staff is wondering what it could mean.
Pam photocopies the list, and the conjecture reaches a fevered pitch. Is it a list of those to be fired? Psychological profiles? Dwight recalls that he himself once divided the staff into various lists, but even he can't make reason of it. The staff demands that Andy go ask Robert California himself. Andy dutifully confronts his new boss about the list. California is appalled that someone would have read his notebook, copied it and passed it around. Still, he explains, it's just a doodle, just one made of words instead of shapes.
The mystery of the list continues. Dwight suggests that they line up according to the list and see if hey can spot obvious differences. As they do, he issues an order for his side to attack the other. Chaos ensues, broken up only as Robert California emerges to invite a select group to lunch: Jim, Dwight, Oscar, Darryl, Andy, Toby, Phyllis, Angela and Kevin - all names from the left side.
At a restaurant, Robert holds court. He asks Jim about Sesame Street, then proceeds to explain how the show reflects the mores of the times. The staffers, looking to curry favor with the new boss, agree and compliment him on his insights. Toby grows increasingly uncomfortable - and excuses himself from the restaurant. "I should have been in the other group all along," he mutters as he leaves.
Dwight asks Robert about why he chose this particular group today. California explains that he thinks they're all winners and wanted to have lunch with them. The group gives a mild cheer, relieved. Dwight then asks if that means that the group back at the office is a bunch of losers. Robert flippantly admits he guesses it does mean they're losers, immediately regretting the remark.
Back at the office, Andy tries to lift the other group's spirits by ordering pizza. There's discomfort and discontent as they worry about why they weren't included. Pam gets a text for from Jim who messages that things are "getting weird." A moment later the entire staff back in the office gets a text from Kevin, who writes, "Suck it, Losers!"
The "losers" lament to each other. Pam takes it especially hard, longing for the days when she was the cute, funny receptionist who could draw, not the "fat mom" she is today. Andy and the staff try to cheer her up, but they're clearly disheartened themselves. The "winners" return from lunch, all smiles. Kevin, and Dwight begin castigating the others. Andy realizes he's got a problem on his hands. He summons Robert California out to clarify matters.
The new CEO doesn't deny his remarks about winners and losers. Instead he recites a litany of things he finds productive: positive reinforcement, negative reinforcement, honesty. He goes on to warn about what he sees as counterproductive: worrying about status. He reiterates that he divided the group into winners and losers - but that life is long and his mind is not permanently made up. "Winners, prove me right. Losers, prove me wrong," he challenges them. He walks back into the conference room.
As the staff recovers from the speech, Andy isn't going to let this stand. He screws up his courage and marches into the conference room and asks Robert California to change his list. When California refuses, Andy offers to draw up one of his own. He goes on to extol the virtues of Stanley, Pam, Erin and others on the list. After defending his colleagues, he tells California that he intends to give the staff a half day off on the Friday prior to Columbus Day. California is surprised and asks Andy if he realizes that Columbus committed genocide on an entire race of people. "Yes I do," Andy tells him. He returns to the office and tells the staff they'll have the half day. Impressed, they give their new boss their thanks as they file out for the day.
As they get ready to leave, Jim tells Pam he's headed outside to warm up the car, intentionally dropping a piece of paper near Pam. She calls out to him, but he keeps moving. She retrieves the paper and finds yet another list. On one side the list reads Pam, Cece, New Baby. On the other side: Everything else.