So, I posted on Kairos moments previously. These are just moments where you have an opportunity to help your kids process what God is doing in their life. It may be a comment from the backseat as you're driving (don't you love those), something that happened at school, a moment with a sibling - the possibilities are endless.
Some of these moments will be positive. Maybe he helped someone at school; she stood up for someone; she encouraged someone; he got a good grade, etc.
Some of these moments can be negative. (Of course the disclaimer goes here, my kids never have negative moments :)). Maybe she got points off at school for behavior; he neglected to tell the truth; she didn't obey when asked to, etc.
That's when we engage the circle - starting with Observe. I usually find where God has spoken on the issue in the Bible. Then I assign that to be read, and we observe how their behavior either contradicted or fell in line with what God has spoken.
In short - observe what happened and talk about how it intersects with what God has spoken.
Next - Reflect.