Replace individual cedar lap siding with new cedar boards. Remove the damaged boards by prying them loose from the wall studs. Locate the nail heads on problem boards and gently pull the nails loose with a pry bar inserted from the bottom of the siding board. Lift the bottom of the board above it to get it loose enough for the damaged board to pull free. Work carefully to avoid breaking the boards.
Remove the entire board or boards or pull a board loose enough on one end to saw off a damaged section with a jig, circular or small hand saw. Cut the replacement board to fit if necessary and slide it into place under the board above it. Position a wood block at the bottom of the board and drive it into place with a hammer. Nail it to the studs at the top of the board and drive in the nails that hold the upper board in place. Put a block of wood over those nailing points to protect the board while hammering.
Install fiber cement siding to replace cedar on an entire wall by stripping the wall down to the sheathing, water barrier house wrap and any foam board insulation. Measure the required distance from the ground to the bottom of the wall, a minimum of 6 inches, then snap a level chalk line. Nail a metal starter strip along that line to slant the bottom of the first lap board.
Nail the first board to the wall studs with galvanized nails driven in at each wall stud. Drive nails 3/4- to 1-inch below the top of the siding. Overlap the next board to cover the nails about 1 inch over the first panel. Start the second row with a different length board if the wall is wider than the length of one cement board so the seams don't align. Use a carbide-tipped blade in a circular saw to cut the boards; lay a board flat and support it on both ends while cutting.
Connect cement fiber boards where two meet in the center of a wall stud. Add overlapping panels up the wall, just like cedar lap siding. Mount metal flashing at the top of the wall to seal the connection between the top board and the roof line or to the bottom of the roof soffit on an eave.