Back in late 00's I worked for a very small shop where it was known that I was toying with the idea of moving on, so we were actively seeking to hire my replacement while I was still there (sounds insane, I know, but it was the right thing to do).
We had an application developed in-house (by me) and the new hire was to take it over -- this implied needing somebody who could become productive quickly and think on their feet. The app itself wasn't insane, just pretty standard (but bespoke) PHP/MySQL/JavaScript that powered a bunch of client sites, so I put together and proctored a "code test" to probably 15 applicants over the course of a year or so.
The extent of it was sitting them down in front of a computer in the office with a couple of simple tasks to be completed (outlined on paper), and a folder of files on the desktop. The tasks themselves were then almost entirely-documented in a big comment at the top of the relevant entry file (index.[php|html|js]). It should've taken somebody experienced an hour to do a decent job at -- yet, not a single person was ever able to complete it. Very few even got close, even though 80% of the work was literally done in the opening comment section, waiting to be copied and pasted. Almost nobody asked any questions whatsoever either, which I've always found strange.
Anyways, I did end up moving on and later participated in many dozens of incoming developer interviews at a much larger place -- other interviewers had their very-technical approaches, but I never again asked anybody to complete a coding task or whiteboard anything. I would simply ask them to walk me through where they've been, what they've done (built, contributed to, etc), and what they like to do. You can tell almost instantly when somebody is full of shit if they can't talk about previous projects in-depth or with fluency (or simply admit that they have no real experience and are hungry to learn).
The interviews where I would report back "not full of shit" turned out to be a bunch of great hires (including one guy who I had actually interviewed years prior with the doomed code test!)
Take all that for what you will -- my personal opinion is that companies are missing out on some really great people specifically because of the interview process, but I also get the feeling that lots of companies aren't actually looking for the people that would be the best hires -- good-enough / "warm body" hires promote business continuity, and that's really better for the bottom line in larger organizations.