You should design it such that everything is in one monorepo and the entire system can always be run on one developer's local laptop without ANY serverless/cloud stuff...and in a single process if possible.

Then if you ever have a bug, you can easily set a breakpoint, step through the entire execution, and fix it.

Agree that this MUST always be possible whatever architecture changes occur.

Then have a flag/config to allow specifying certain things to communicate over network instead of as function calls, and using serverless functions.

I've NEVER seen teams do this though. It's like no one can imagine they will write a bug.