Controlling is part of leading people but sometimes, it has bad effects. Punishment and reward can be used as a tool in motivating people especially in a team. However, if either of the two goes beyond its limit for the employees, there might be negative effects that could happen. People could earn fear if they are punished that could lead to inefficient work habit or even worse. But in some instances, employees get to be motivated with the help of putting punishments on them because they tend to meet their goal under pressure in a short period of time. For me, it is not good to push your team to the limit because they will be stressed out and they might lose their confidence and self-esteem due to the manager's negative criticism about their performance and the not so good outcome of their work. On the other hand, rewards really motivate a team by giving them such incentives by means of bonus in terms of money or better benefits, and even promotion and outstanding recognition in the company. But, we must keep in mind that even rewards inflict good effect to employees, there's always been the opposing side. Over-rewarded employees might also be over-complacent and could bring to ineffectiveness of their performance.
We can say that rewards and punishments are just two sides of the same coin wherein the only goal of the company is to polish the working attitude of their employees and make a job well done. But managers must know where to put reward or punishment at times so that they can avoid failure works of their staff. It'll be better if there will be a balance between giving rewards and punishments. Putting rewards and punishments on employees has its own advantages and disadvantages in their own way. These two might serve as a motivating tool so that they can achieve their goal.
Managers should have a knowledgeable tactic in giving such rewards or punishments with his/her team to avoid undesirable effect regarding the performance of the employees during work.