Apply construction adhesive to the face of a sheet of rigid foam insulation. Put a glob of adhesive every 12 inches in a grid pattern over the entire surface of the sheet. This allows the adhesive to make solid contact with the surface of the cinder blocks and assures a good bond.
Press the insulation panel against the cinder block wall, being sure its edges are vertical and in line with the wall.
Continue applying as many insulation panels as necessary to cover the entire wall, butting them tightly against one other. Cut out holes for vents, windows, doors and other wall features, using a sharp utility knife.
Tape the joints between the insulation panels with construction tape.
Install furring strips at 12-inch intervals over the surface of the insulation panels. If your siding is going to be vertical, install the furring strips horizontally. If your siding is horizontal, install the furring strips vertically. Hold a furring strip up against the insulation panel, then drill through it and the panel into the cinder block, using the hammer drill. Twist in a screw until it holds the furring strip tightly against the surface of the insulation panels.
Attach the siding to the surface of the furring strips by hammering finish nails through the siding and into the furring strips.