Following a visit under the Inspection of Local Authority Children's Services (ILACS) framework, which has replaced the single inspection framework (SIF), Ofsted found a number of positive developments within children's services in the Greater Manchester borough since its last inspection in 2014, when it was also graded as requires improvement.
However, it warned that managers within the department are too preoccupied with compliance and need to pay more attention to the quality of social work practice.
"Leaders have been successful in making improvements to many areas of the service, often in response to previous inspection findings," the report states.
"Despite this, the quality of practice that children and families experience remains inconsistent and the overall effectiveness of children's social care is not yet good."
Inspectors found the borough had enhanced its services for children in care, care leavers, children who go missing and those at risk of sexual exploitation. They also reported that reduced turnover of social workers and said the council had been successful at incentivising its departments to offer apprenticeships to care leavers.
However, Ofsted criticised Rochdale's handling of children in need who are not at immediate risk after finding ineffective assessments and planning meant children were being stepped down to lower levels of support before sustainable change had been made.
Inspectors said Rochdale's managers and social workers are "overly optimistic" about the situations faced by children experiencing neglect or domestic abuse. An over-reliance on performance data and ineffective quality assurance had meant the service's leaders had not spotted this weakness and so have no plans for addressing it, Ofsted added.
In addition, most child in need and child protection plans lacked "clear outcomes" and did not focus on measuring progress or change within families.
"The Ofsted report recognises that progress is still being made in improving the council's services for children," said Gail Hopper, director of children's services at Rochdale.
"We are particularly pleased that inspectors saw how we have transformed the experiences of children in care and care leavers.
"However, we also recognise that we are still on a journey and that there are areas that we need to improve on. That includes strengthening the role management play in improving the quality of our work with children and families, which remains variable in a number of areas."
Ofsted has said the ILACS framework is "more proportionate, risk-based and flexible" than the previous Single Inspection Framework, which was introduced in November 2013.
Under the new system local authorities that are rated "good" or "outstanding" will receive a short one-week inspection every three years while those graded requires improvement will get a standard two-week inspection every three years. These councils will also have at least one "focused" visit between inspections.
Councils judged to be "inadequate" will have quarterly monitoring visits followed by a full inspection under the SIF.