Actually, Its more than easy to implement! Surprisingly, I will clarify it:
Imagine a block from 9 bits, Each bit is entangled with each other with invisible rope, When a 1 bit enemy shell hit, It will penetrate the Middle Right side bit and take from the block only one bit, How many left? 8,
Did it degraded? Yes, What reason? due to damage, Was there a shell left over? Dependent on Shell type, if it was AP, APHE, HEAT, HESH, ATGM, etc, if it was for example AP Or APHE, it will definitely make a left over bits in the penetrated area, If it was an ATGM, it will make a straight penetration hole in the armor, Simulating the Shock wave effect ( Monroe Effect ), And for simplicity, each bit will Start getting simulated when the game senses there is a shell coming BEFORE impact, For example:
A shell coming, Which direction? Front, Which Part of the tank? Hull, What shell type? APHE for example,
the operation will follow like the in the past example, also making aleftover, this Concept is incredibly simple and easy to implement, Follow a pre determined equations, rules, and conditions for the game to render and provide a precise answer about Armor Degradation mechanic and how will it increase game realism.