Would your employees argue that your organizational hierarchy produces its haves and its have-nots? That's the question posed in the third episode of Mad Men (Season 3). It's a warm, end-of-summer weekend, and Roger Sterling and his fiancée Jane (who is Don's former secretary) are hosting a party at their club. The guest list causes a stir among Sterling Cooper's middle management. The two new heads of accounts, Pete Campbell and Ken Cosgrove, make the cut, as does Harry Crane, the head of the agency's TV division. But the creative staff (with the exception of creative director Don Draper) are not included and they grumble about it—a phenomenon my colleague Leigh Buchanan surveyed in this column. Adding insult to injury, the copywriters are asked to work all weekend on a pitch for the rum company Bacardi.

Among the management lessons that made their way into the teleplay this week:

1. Nobody actually enjoys forced work socializing. Even as the creative staff sulks back at the office in midtown, the lucky few invited to the club are a tense and nervous lot. Betty and Don can't conceal the fact that they would rather be somewhere else, even though they feel perfectly comfortable at Roger's table. Pete and his wife Trudy do a nice job of blending into the WASP-y habitat (though perhaps they are a little too comfortable), but Pete's efforts to butter up Don and Roger are mostly fruitless, and he is dejected. Harry, meanwhile, is paralyzed by the fear that he will somehow embarrass himself; his wife Jennifer is more confident if not especially socially adroit.

Point being, people are not really having fun.

Of course, that may not have been Roger's objective in the first place. But bosses would do well to remember this little tip: inviting members of your management team to a party all but ensures that it will be a really terrible party.

2. If you slight a worker, he will inevitably act out. Rebuffed by Roger, copywriters Peggy, Smitty, and Paul halfheartedly attempt to work on the Bacardi campaign. As morning turns to afternoon, creative block becomes procrastination, which becomes screwing around. Egged on by Smitty, Paul calls Miles, a college singing buddy who is now a pot dealer, and they all smoke up in the office to the dismay of Peggy's new secretary Olive.

3. Collaboration is great, but one worker alone in her office can often be more productive than three in a conference room. The Bacardi project is a mess and the more the group talks it over, the further they seem to get from coming up with a usable idea. Similarly, when a chunk of the staff gathers to cast a woman to appear in a commercial for Patio, a new diet cola, the meeting becomes chaotic.
The only real progress on the Bacardi deadline is made at the very end of the episode when a starry-eyed Peggy dismisses the guys and heads into her office with a Dicta Phone and a germ of an idea.

4. If you're the boss, take note: Everyone is watching you. When Don and Betty arrive at Roger's party, it becomes clear that all of the middle managers and their wives are eager to curry favor. It also becomes clear that Pete and Trudy and Ken and Harry and Jennifer know and think a lot more about Betty than she thinks about them. They're up on her pregnancy and what she and Don do in their spare time.

Similarly, Olive seems to be very watchful over her new boss, Peggy. (Peggy soon realizes that this is because the older woman wants her to succeed, and worries she's putting her advancement at risk.)

This theme of staff scrutiny reminded me of a story that Eric Kriss, a cofounder of Bain Capital, once told me. He was running a company and, at the time, he drove an old, beat-up car. One day, he came to work, and a top programmer pulled him aside.

Just how badly were the company's finances? the programmer asked.

Kriss was surprised by the question—the company was doing fine, he said.

Nobody would drive that car unless their company was on the verge of failure, the programmer replied.

The lesson? Even when you don't think you're sending any signals, your employees are looking for clues that reveal your mood and, by extension, the health of the company and, by extension, how secure their jobs are. Whether you like it or not, performance is part of any leader's job description.