I homeschool my children, and I don't grade their work. Instead, I use the errors they make to guide my teaching; what they can't do successfully obviously needs more of my attention and theirs.

What's interesting is the difference that makes in what feels like an accomplishment to them. Whereas I would be proud, in the public schools, to have the highest test score, my kids are proudest when they manage to excel after failing. If they excel the first time around, their response is, "Well, okay, but that section was easy."

I think that's a more beneficial attitude to carry into their futures.