From Wikipedia:
We know the sum of an infinite series is defined to be the limit of the sequence of its partial sums, if it exists. The sequence of partial sums of Grandi's series is $1, 0, 1, 0, ...$, which clearly does not approach any number (although it does have two accumulation points at $0$ and $1$). Therefore, Grandi's series is divergent.
Cesaro's method of summing up divergent series: The basic idea is similar to Leibniz's probabilistic approach: essentially, the Cesàro sum of a series is the average of all of its partial sums. Formally one computes, for each $n$, the average $\sigma_{n}$ of the first $n$ partial sums, and takes the limit of these Cesàro means as $n$ goes to infinity.
For Grandi's series, the sequence of arithmetic means is
$1, 1/2, 2/3, 2/4, 3/5, 3/6, 4/7, 4/8, …$
or, more suggestively, $(1/2+1/2), 1/2, (1/2+1/6), 1/2, (1/2+1/10), 1/2, (1/2+1/14), 1/2, …$
where $\sigma _{n}={\frac {1}{2}}$ for even $n$ and $\sigma _{n}={\frac {1}{2}}+{\frac {1}{2n}}$ for odd $n$.
This sequence of arithmetic means converges to $1/2$, so the Cesàro sum of $\sum a_{k}$ is $\frac{1}{2}$. Equivalently, one says that the Cesàro limit of the sequence $1, 0, 1, 0, …$ is $\frac{1}{2}$.