how to fix rotten exterior wall
I see that you have posted two questions about this situation. I fear you have to address a couple of problems here.  First and foremost is to try to route water away from this area. We can address this in another segment with more info on the area in question.

As far as the immediate problem, I am pretty sure you will have to remove the damaged sections of the rotted siding. I also suspect there will be damage to the bottom plate and will have to be replaced as well. Also inspect any insulation in this wall for moisture damage and mold.  I would be looking at replacing the sill plate with pressure treated lumber and seal it with caulk under the plate to avoid any water creeping indoors under the plate.  If you do not want to replace the entire height of the siding, you may be able to scab a matching replacement patch in there, but that could be unattractive.  You could install a horizontal trim piece along the bottom, under cut or flashed to the siding if the rotted section is not too high up the wall. The important thing here is to remove the rot and create a side wall that will not rot again. You could use a PVC trim board (1X8 etc) or other rot resistant material. This is one of those jobs that require a look-see and adapt a solution as the amount of damage is determined. If you are looking for step by step directions for cutting, removing, and replacing, that is a whole other discussion, depending  on your level of expertise and tools you have available.