Efficiency is the rate of conversion and extraction of sugars from the malt as compared to a theoretical maximum yield, expressed in parts per pound per gallon (ppppg). Let say a 2-row pale malt has a potential yield of 1.037ppppg. That means that if you mash one pound of grain in 1 gallon of water, and you ended up with an O.G. of 1.037 you would have achieved 100% efficiency. Of course no one can get every bit of starch to convert, nor can you rinse every bit of converted sugar off of the grain, so a typical brewhouse efficiency is around 70-80%. Lots of factors contribute to brewhouse efficiency including: crush, equipment, mash temp, sparge type/rate, dead space/loses, quality/age of grains, etc. The only way to know your efficiency is to brew a few all-grain batches and take measurements with a hydrometer. If you have never brewed all-grain, a good number to start with might be 65%. If you manage better than that you'll just end up with a little stronger beer, and that's not all bad.