if you look at all the features and identify up front the split between hardware and software implementations then that works really for optimising the project. Assuming of course that the requirements/features don't change.
We do a lot of projects where we can significantly reduce the overall cost by doing this allocation up front.
The total cost of course spans more than just component cost and development cost. There are also manufacturing costs, reworks costs, return costs and tooling costs to consider. And it is the best overall position across all these costs that matters. This is the main thrust of strategies for low cost electronics manufacture.
If you just optimise for one aspect then you rarely get the overall result you want.
The trend is clearly to do more in software to get component costs down but it doesn't always work out like that.
