In Steven Covey's "Seven Habits..." book, he relates a story of a consulting gig. After asking "what's the best way to motivate..." some one spat out "hand-grenades". Apparently a bit of a debate broke out. I've wondered what would say during that, and think I have my answer. "That's effective if your goal is to build a subservient fiefdom. If you're trying to build a dynamic team of effective contributors, this will fail gloriously."
In today's economy, a company of meandering automatons who only act directly upon orders is a recipe for failure. This is a blind bureaucracy. Any need for independent thought or action induces a fear based paralysis. These are non-agile orgs that cannot react nimbly. Their only strength comes from sheer mass. Most of the entities which remind effective do so because they command immense resources, enabling them to catch up with innovators...eventually. Or they just acquire them.
Many managers feel empowering their teams is some fluffy, sentimental fad. Sadly, some systems allow them to flounder in their ineffectiveness. They remain blind to the costs they craft, and to the opportunities squandered. Thus is the path of fear and brutality.