The longer answer is: Fundamentally, you need to address the fact that there exist a huge number of people in this industry declaring they have masters degrees/phds or years of industry experience, but when pressed they can't write even the simplest of functions.
While we called it out explicitly, some folks seem to miss that "Custom" questions are still fundamentally DS&A leetcode-style questions. I completely agree that "leetcode style" interviews are flawed, but most people don't have a better answer for this problem that still guarantees the person you're hiring actually can code.
We are optimizing for coders that make good choices quickly, and if they can code efficient code to toy CS problems, then you at least guarantee that 1) they can actually code and 2) they can code simple things quickly. Non-coding interviews allow you to hire people who can't do these basic things and therefore guarantee their performance is worse in a production environment.
The whole algorithm and leetcode thing just seems so off and unpractical to me.
Then once they have done the exercise there are so many practical things we can discuss about the existing code. Peformance, quality, etc, etc.
Leetcode questions can be fairly basic algorithmic/data structures questions, like "how do you store an ordered collection with O(1) lookup (ordered dict, i.e. hashtable + list)" or "check if this list contains duplicates" (use a set, not a list!), or "calculate the square root of this number" (bisecion, i.e. looping).
These are not production code questions, but the benefit is that they're easy to explain and understand in the limited time you have available for an interview.
Unfortunately there are more than expected number of people who fail these basic questions. You really don't want to hire them.
I'm not advocating for spot tests on complex algorithms without context. However, I believe a conversation about fundamental concepts like big-O notation reflects on one's approach to problem-solving and software design. It's not about dismissing anyone's experience or capability but ensuring a solid foundation that benefits all aspects of engineering work.
I understand senior engineers being out of practice and not being able to derive things like topological sort on the fly, but an inability to talk about the basics of big-O or the simplest of data structures is more commonly a red flag than "rust." If they never learned the material, that's a red flag. If they learned the material and they've been building software for the last decade without taking the basics of the material into account while coding, then that is a red flag as well.
Again, happy to admit that this is a flawed approach that will lose some great engineers, but most engineers that have your line of thinking are ones I actively avoid hiring. These concepts are practical, available to learn for free, and easy to understand. If an engineer feels that testing these concepts is beneath them, then they definitely aren't a good fit for any team I'm on. Big-O is to software engineers what Ohm's Law is to electricians. Imagine a world where electricians thought it was demeaning to talk about Ohm's law in an interview. ¯\_(ツ)_/¯
