When you want to train animals (and people, we're not all that different) you have four options: positive reinforcement, negative reinforcement, positive punishment and negative punishment. If I am not much mistaken, I believe positive reinforcement works the best. Try to incentivize people to use their time productively, instead of trying to punish them for using it unproductively. And people hate takebacks (like Michelle said). So if you're planning restricting internet access, be prepared for grumbling and lowered morale. People don't like having anything taken away unfairly (when has anyone ever felt it was fair?) and they'll fight for it. About how to incentivize them to do so, Zukin had an idea I liked, about offering them either a piece of the profits or something similar. Be careful of creating a cut-throat atmosphere, though.
Since you're into PD (I'd imagine), have you tried to encourage employees to improve themselves? Either by distributing copies of Getting Things Done (or offering them for a steeply discounted price, you might like to have some very small barriers to entry to create breakage) or trying to introduce this site? Depending on what the company does, be warned, some people might decide to follow their dreams and leave the company.
And like others said, if they're reaching their goals, let them relax. You can monitor their usage, as long as they know, but think hard before putting in any measures to curb it.