I was once involved with a company (not as an investor) where an embarrassing mistake was made. One of the leaders took a sort of "heads will roll" approach. It's not my company so I basically stayed out but tried to encourage him to think differently about the "punishment." I didn't stick around for the repercussions so I hope the process was balanced.
But it got me thinking about the topic of leadership and how to manage people through "light" and "heat." (Think carrot & stick but I like my analogy better because we're humans not animals.)
As a leader you need to have both heat and light in your arsenal. You cannot lead all people all of the time through light. In my experience some individuals are the over-achievers who are looking for stars on their foreheads and thrive on constant positive feedback. For these people you need to lead through *mostly* light. There are other types of people (let's say, prone to a bit of laziness or procrastination) who tend to be motivated more by fear of being in "trouble" and not wanting to look bad. These people are led better through a bit of heat.