Quarter square digging & fill ability

I use the retaining walls quite often. But at times, it can be difficult to get the ground level enough to install the second or third tier of a wall. One dig level leaves too much dirt in the way. But when I go down one more level, the previous wall collapses. If there was an ability to dig out a quarter of a square that you could get in much closer, this would alleviate the problem. It would also be nice to add material in the same quarter square size to fill in the gap after installing a wall. Make it something that is very slow to dig so that it could not be feasible to use for regular work. Maybe a back-hoe team or something similar.