Michael hosts a Christmas party at the office, but somehow manages to decrease the holiday cheer when he changes the arranged secret Santa pairs to a game of "Yankee Swap", where everyone gives their pre-bought presents to a different, random worker. To boost morale, Michael introduces vodka shots while the others compete for an iPod, Jim hopes that his sentimental present, meant for Pam, doesn't end up with Dwight, and Angela becomes enraged about Michael's party changes.

Dwight must confront his fear of public speaking when he is named Dunder-Mifflin's Salesman of the Year. To prepare for a big convention where he is set to give a speech, Dwight turns to Michael to guide him in his quest to conquer the fear. Meanwhile, Pam gets wrapped up with wedding plans, but Jim has plans of a different sort: an escape route out of Dunder-Mifflin and Scranton, at least for long enough so that he doesn't have to witness Pam's wedding. While all of this is happening, the staffers battle it out over control of the thermostat.

When Michael takes over conflict resolution duties from HR, chaos ensues at Dunder Mifflin.

Michael speaks out of line at the Dunder Mifflin shareholders meeting and creates a big problem for management, while Jim discovers that nobody in the office thinks he's the "real" boss.

After reading an article about China growing as a global power, Michael decides China must be stopped before they take over the US. Everyone in the office complains about Dwight's building standards and Pam threatens to move Dunder Mifflin to a new building.

After Robert California challenges the Dunder Mifflin staffers to double their sales, Andy, taking matters into his own hands, creates an incentive program. Eventually, he promises to tattoo himself if the staff doubles their sales. Meanwhile, Pam strikes up an unlikely friendship with Angela, both of whom are pregnant.

After Robert decides to sell his mansion following his divorce, Kevin suggests that he have an office pool party. Erin tries to make Andy jealous by flirting with Dwight. Meanwhile, Robert gives everyone a tour of his massive home.

When the party planning committee drops the ball on the annual Christmas party, Dwight gets everyone to celebrate with a traditional Schrute German Christmas. Darryl fears that Jim has forgotten to include him in the new job in Philadelphia. Pete teaches Erin about his favorite movie, Die Hard.