I have a shed that sits on a concrete slab. There was some miscommunication between the contractor and I when the grading was done and foundation and slab was poured and so the bottom of the siding (T-111 plywood) sits too close to the ground. Rains splash the bottom and over the years the plywood is rotting away. It's time to do something about it but I'm not sure what.

I don't like the idea of replacing all of the sheets in their entirety when only the bottom 5 - 7" are damaged. I found this page: (see link attached) which shows cutting the damaged sections out and replacing with a piece of Z flashing and then more siding.

This seems ok but predestined to rot again in time. Is there a better way? I am thinking instead of cutting out the damaged section and replacing with a piece of the largest 1 or 2 x treated material I can find. Is this a good/bad idea? Not sure how to make it line up at the joining of the siding and lumber so that water doesn't wick back up into the siding.

Other ideas?
Thanks,
Dukeseter

Here is a link that might be useful: Repairing rotten siding link