Scrape away the soft wood and the rotten wood and expose the core, those remaining veins of hard fleum beneath the bark. Some, like beech, show long, narrow cavities. Scrape the wood, gauge out the loose soil, score it with wire brush, scrape again. Then look, pay attention to the grain and the form.
Now for the carving. If you carve into wood, you had better follow the rules. Push against the grain at your peril; chip into a knot at risk of blunting your tools. Wood taken away is wood gone forever. Wood carved too thinly across the cellular layer is wood that will snap under pressure. Listen to your work; feel through your hands; watch as the wood responds to your urging. It will tell you where and how. Chisel away the unwanted wood. Deepen the deep crevices. Take out the stone to be replaced later. Lay the flat of the chisel along the surfaces and, always, follow the grain. Then stop. Leave it for a while, look, and, when you are ready, start again.
Sanding, smoothing, oiling, polishing, and finally mounting on stone or wood.
Work with care, with sympathy and with respect, and your work will be as a gift. The beginning of life was also the beginning of death but also the possibility of new life. There was a slowing, a hardening, a failing, a bending and breaking, a rotting. The tree one day became a stump above an earthen, decaying system of root, a relic of the tree that was. But some of that tree was taken, and carved, and reborn.