The concept of "time out" for kids has never made a whole lot of sense to me. I have watched a lot of parents simply put their child in a chair and expect that to make them obedient and compliant. Very young kids are not developed enough to understand wrong vs. right actions on their own. However, I think there is a redeeming quality of the time out method that can help parents train their child up instead of leaving the child to stew or sit in confusion.
With every offense a child commits, parents are given a golden opportunity to seize the moment and teach their child about the Lord. We are to teach them obedience to the authority of God, and then to the authority of us, their parents. God's Word commands us to instill the principles of Scripture into our children (Deut. 6:6-9), and so it is up to us to show them the way to the cross of Calvary.
Not long ago, I made what I call a Clean Heart Chart for Nathan (which I am sharing today!) and it has been very helpful in teaching him discipline and seeking after true forgiveness and purity of spirit. When a sin has been committed, I will discipline him, and then ask him to go to a quiet room, sit down, and pray. I tell him to ask God to forgive him for behaving wrong and then, when he is ready, to come back to me. After that, we make amends, pray together, and go about our day. I am slowly beginning to see a tenderness in his spirit when he does something wrong that goes beyond him simply "getting caught." He is learning to understand that when we do or say bad things, we hurt others and ultimately hurt God.
I challenge you to make the most of your "time outs" with your little ones. We only have one life and one chance to impact our children for eternity. Let's not be lazy and waste it.