Mind Over Matter: Why Intellectual Capital Is the Chief Source of Wealth

by Ronald J. Baker

Praise for Mind Over Matter Why Intellectual capital is tHe Chief Source of Wealth

"Ron Baker has written another great book on the thoughts and theories on intellectual capital.As usual, he has an awesome depth of content, knowledge, and thought. A great read."

--Reed Holden, founder, Holden Advisors Corp., www.holdenadvisors.com, and coauthor, The Strategy and Tactics of Pricing and Pricing with Confidence: 10 Ways to Stop Leaving...

• Format: Hardcover
• Language: English
• ISBN: 0470053615
• ISBN13: 9780470053614
• Release Date: November 2007
• Publisher: Wiley
• Length: 368 Pages
• Weight: 1.50 lbs.
• Dimensions: 1.2" x 6.4" x 9.3"

Customer Reviews

People as the real source of value

This is an important book on an important topic - the creation of value and wealth by people working together in services relationships. It's hard to tell from the title, but this is, among other things, a one-volume economics education. Baker builds on extensive quotes from a who's who of economic and business literature, including a satiric essay on balance of trade fallacies by Frederic Bastiat, and the full text of a prescient speech Ronald Reagan in Moscow in 1988. The book is written in an approachable first-person style, as befits an author who seems to be a bit of a cult hero in the world of accounting ... yes, accounting! Don't let the focus on economics and accounting throw you off. This is a business book with an edgy and timely message. Baker provides a harsh critique of current accounting practices as lacking theory, in the sense of ability to explain, predict and prescribe. He describes current accounting practices as the "three blind mice" of the balance sheet, the income statement, and cash flow that can only record value after the fact, and do not properly address the value of intellectual capital. He is also a critic of Sarbanes-Oxley Act of 2002, which he maintains has done more harm than good. He is not alone in this evaluation, (see The Sarbanes-Oxley Debacle: What We've Learned; How to Fix It (Aei Liability Studies) ) but he goes beyond other critics by proposing positive alternatives to costly and restrictive regulations. This book provides key intellectual underpinning for Baker's longstanding quest to do away with such industrial vestiges as billable hours, timesheets, cost-plus pricing. His VeraSage Institute is a think tank for improving the position and practices of professional service firms. Specifically, Baker and VeraSage focus on knowledge workers in the truest sense of the term as people who "own the means of production, and apply knowledge to knowledge to create value". Baker maintains that people should not be regarded as an unfortunate cost, but rather seen as volunteers, who can walk away from any employer, simply to invest their personal intellectual capital elsewhere. He sees knowledge as a nonrival asset, meaning that its value to one person is not reduced when it is possessed by others. Perhaps at a later date he will return to an analysis of the comparative value of fresh knowledge that provides advantages vis a vis competitive rivals. Baker insists that knowledge work must be better monetized, beyond the stultifying practice of simply measuring hours spent on the job. As precedent for alternative monetization, he cites the frequent flyer programs of airlines that constitute a massive alternative currency. "Money is not wealth per se, it is merely how members of a society move it around ... the wealth of nations resides in consumer well-being, not profits." This is focus on well-being is supported by long-wave economic theorist Carlota Perez (see Technological Revolutions and Financial Capit