2. a programming task. Choose 1 of 5 tasks. The tasks are not abstract problems or puzzles, but come out of the designs we've implemented. We ask for 100 lines of code and not more than 2 hours. They take as much calendar time in days as they need, most have full time jobs, and let us know when you're done. The candidate then comes back, typically in 2 to 7 days and hosts a code review in front of our team. I give strict instructions before hand: The purpose of the review is to learn how they thought through the problem and how they solved it, not to criticize their style and approach.
3. If we decide we like them to this point, the third interview is with managers from other functions. How well does the candidate communicate, come across to non-developers, express interest in the company and role, etc. It's a check point to look for concerning weaknesses, as well as get buy in from the broader organization.
We like this approach because it allows the candidate to code in a much more natural environment. They can take the time they need and comfortably solve. No one spends their professional career coding on a white board. This approach so far has yielded excellent results. We ask developers how much time they took in the programming task and why they chose the one they solved. The programming task is telling, not in the quality of their code and how long they took, but how much did they get into it? We have had the range from candidates who did not complete it at all and opted out, to candidates who stumped 40 year veterans with elegant code. In every case, we learn how well they can express their thoughts, and importantly, their level of love for the discipline. This is as important to me as any other attribute.