A few years ago, our HR department asked me to put together a process for sending out reminders to people if they appeared to be falling significantly behind in taking their holidays. It was worded carefully to avoid any appearance of pressuring, but emails would be sent out at the 6, 9, 10 and 11 month points to people whose proportion of holiday entitlement still unbooked was greater than the proportion of holiday year still remaining. It has worked well, and encourages people to plan their time off well in advance. Very few people fail to take all the holiday they're entitled to and respecting holiday time is demonstrably now a part of company culture.
For my part, I certainly take all my holiday, and do my utmost to ensure my team does likewise. I've never seen productivity suffer from time taken off, but have frequently seen it benefit. I tend to find that the more you look after someone, the greater effort they put in to try to justify that consideration, and to me that seems a much better motivational technique than employing a sword of Damocles.
Semper in excretia, suus solum profundum variat