The Origins of Efficiency

by Brian Potter

A step-by-step examination of how production processes—from penicillin and automobiles to steel and semiconductors—get more efficient over time, and why it matters for unlocking a new era of abundance.

Efficiency is the engine that powers human civilization. It’s the reason rates of famine have fallen precipitously, literacy has risen, and humans are living longer, healthier lives compared to preindustrial times. But where do improvements in production efficiency come from?

In The Origins of Efficiency, Brian Potter argues that improving production efficiency—finding ways to produce goods and services in less time, with less labor, using fewer resources—is the force behind some of the biggest and most consequential changes in human history.

With unprecedented depth and detail, Potter examines the fundamental characteristics of a production process and how it can be made less time- and resource-intensive, and therefore less expensive. The book is punctuated with examples of production efficiency in practice, including how high-yield manufacturing methods made penicillin the “miracle drug” that reduced battlefield infection deaths by 80 percent during World War II; the 100-year history of process improvements in incandescent light bulb production; and how automakers like Ford, Toyota, and Tesla developed innovative production methods that transformed not just the automotive industry but manufacturing as a whole. He concludes by looking at sectors where production costs haven’t fallen, and explores how we might harness the mechanisms of production efficiency to change that.

The Origins of Efficiency is a comprehensive companion for anyone seeking to understand how we arrived at this age of relative abundance—and how we can push efficiency improvements further into domains like housing, medicine, and education, where much work is left to be done.

Genres: Economics, History, Science, Nonfiction, Business, Technology, Productivity

384 pages, Hardcover

Published October 14, 2025

About the author

Brian Potter is a Senior Infrastructure Fellow at IFP and author of the Construction Physics newsletter.

Brian writes about the technology and economics of building construction, with a focus on improving productivity and reducing costs. He previously managed an engineering team at Katerra, a SoftBank-backed construction startup, and has 15 years of experience as a structural engineer.

Brian has a bachelor's in civil engineering from Georgia Tech, and a master's in systems engineering from University of Central Florida.

Reviews

[Marks54 · Rating 5 out of 5]

“Effiiciency” is one of those words that most people claim to be familiar with and to know something about. However, to press the matter of what efficiency actually means in detail, it becomes obvious that that the word only masks a huge number of meanings and terms. To go into depth on what efficiency means is a challenge. How did Adam Smith’s pins actually get manufactured? How are they manufactured today (spoiler - much more efficiently than in 1776)? What about light bulbs? Where do light bulbs come from and how has their production changed over the 20th century?

Brian Potter has produced a general purpose introduction to the various meanings of efficiency that should be required reading for anyone interested in understanding the dependence of modern society on cumulative efficiency. The book is organized around a broad general framework of different aspects of efficiency, with chapters explaining different aspects while elaborating them with detailed and thoughtful examples. While there are occasional numbers and formulae involved, the key to this book is in the explanations and the detail. There is material to keep the engineers and economists engaged but most patient readers will learn a lot from this book.

Perhaps the strongest contribution that Mr. Potter makes in the book is not just the explanation of terms and concepts but more his explanation of the critical role of incremental and cumulative learning — by most everyone involved in efficient processes — that is essential for significant process to occur. “Learning by doing” and “Experience curves” are how efficient activities are originated and improved upon, to sometimes dizzying degrees.

Potter is also masterful at explaining why some activities are more amenable to efficiency gains than others. His explanation of the limitations of home building and construction in this regard is particularly memorable. Towards the end, he also offers some interesting speculation about how continuing innovation using A.I. might help bring increased efficiency to traditionally resistant areas.

This is an amazing book that deserves multiple readings. It is well worth the time and effort.

[Paul · Rating 4 out of 5]

As an operations engineer who has been involved in many of the technologies and tactics described, I found it a breezy review of much of my education and work. I was hoping for, perhaps naively, that he'd be talking more about the near future. He finally got to that in the last few pages, but it was too little too late.
So, I think this is helpful for non operations folks to get a great overview of how operations science has reduced the cost of goods throughout the last two hundred years. Might even be a good textbook for an ops course in a liberal arts school.

[Héctor Iván Patricio Moreno · Rating 5 out of 5]

Es un libro interesante que explica todo lo que debes saber sobre un concepto que siento que está en la mente colectiva, pero que está lleno de mitos y no está tan claro: la eficiencia industrial.

Explica por qué es importante y cómo nuestro mundo está construido en torno a esta eficiencia. Nuestro estilo de vida se mantiene gracias a los grandes procesos industriales y de producción en masa que nos permiten comprar artículos de primera necesidad a precios asequibles.

Me gustó mucho porque explica progresivamente cómo se puede ir haciendo eficiente un proceso industrial, los lugares en los que se puede ahorrar trabajo o costo, las economías de escala, los efectos de red, los procesos continuos, el ahorro en los pasos, etc.

Cae muy fuera de mi área de experiencia, pero me ideas para aplicarlo en mi carrera y en mi trabajo. Finalmente, como todos los libros de Stripe Press, es un objeto hermoso, muy recomendado para estar en una biblioteca física.

[Kevin Postlewaite · Rating 5 out of 5]

Long form by the excellent author of the Construction Physics Substack.

I love the author's Substack and I've long been interested in understanding processes and process efficiencies. This is an astoundingly good book that analytically enumerates the changes that can happen to processes. It pairs well with books that give a more example-based exposure to processes like The Goal (Theory of Constraints), Lean Thinking (Lean Manufacturing), and The Machine that Changed the World (Toyota Production System). It's important to note that the author understands deeply the differences between these different featured manufacturing systems, as well as Group Technology, a system that I've only been to exposed to by this author (this book and the author's Substack).

[Wadi Bishara · Rating 5 out of 5]

A marvellous book that simplifies almost 200 years of human improvement into a dense, knowledge-filled 500 pages. Never feels boring or forced and you end up learning a lot on so many fronts. Highly recommend

[Rohan Jha · Rating 5 out of 5]

An interesting topic, thoroughly explained.

[Ari · Rating 4 out of 5]

We produce vastly more than we used to, and vastly more per hour. This book looks at why. It's a bit dry; it's organized mostly thematically and the prose and technical explanation is competent but not amazing.

The main theme is that high-throughput continuous process tends to be the efficient option; rather than hammering a nail into shape, we have continuous nail making. The causality is subtle -- it's not just that continuous process _is_ efficient, it's that you can _only_ run a continuous process if you have a high level of consistency, low level of waste, etc etc.

The author also points out efficiency gains from physics -- e.g. you lose less waste heat in a big reaction vessel; you have less water resistance from a big boat. But of course you hit scaling problems too (increasing variation, longer diffusion timelines, more forces) and so it's a process of exploring the learning curve.

I would recommend this book to engineering nerds; it would be fine as a freshmen or sophomore textbook for operations research, chemical engineering, etc. For the general public I'm not so sure.

[Austin Barselau · Rating 5 out of 5]

The Origins of Efficiency is a marvelous investigation into how certain industrial production processes become dramatically more productive over time. Brian Potter—structural engineer and author of the Construction Physics newsletter—offers a crisp, illuminating analysis, backed by a wide range of well-sourced case studies, of the forces that drive persistent improvements in output, quality, and cost.

Potter’s thesis is that efficiency is rarely the result of a single breakthrough; instead, it emerges from relentless iteration, tight feedback loops, and the selective, flexible application of mechanization and automation to labor-intensive tasks. He explains how successful production systems typically advance through iterative refinement that yields greater performance for a given investment—so-called S-curves—and how economies of scale and learning-by-doing (learning curves) compress costs as production expands. He traces the distinctive features of lean, high-throughput systems—Ford’s assembly line, Taylor’s scientific management, the Toyota Production System, and modern product-development methodologies—that reduce variation, eliminate waste, and align human labor with mechanized processes.

The genius of The Origins of Efficiency lies in Potter’s meticulous deconstruction of how “winning” production processes actually work. He highlights cyclical methodological improvements such as the cultivation of specific bacterial strains that made mass production of penicillin feasible, and the development of the Corning ribbon machine, which enabled high-volume manufacture of glass bulbs for incandescent lights—replacing the hand-blown techniques of the late nineteenth century. Across these histories, Potter repeatedly returns to a hallmark of mature production: the shift toward continuous, scalable, uninterrupted transformation of materials. He illustrates this progression through nail-making—first hand-forged in the late 1700s, then produced via machine-based cut-nail processes, and later through the largely automated wire-nail method—each step reducing product variation while stabilizing and accelerating production rates. In parallel, he shows how firms experimenting with riskier, more novel methods often reduce input costs through vertical integration and deliberate redesign of upstream constraints: Ford’s ownership of sawmills, coal mines, and railroads to control supply-chain costs; Tesla’s move toward large aluminum castings in place of multi-part stamped assemblies and its in-house development of specialized alloys to suit the requirements of new manufacturing techniques.

Potter then demonstrates how these attributes—standardization, reduced variability, continuous flow, and disciplined feedback—are formalized within iconic production systems. Ford’s assembly line and the Toyota Production System, for example, prioritize simplified sequences, one-piece flow where possible, the subdivision of labor into repeatable steps, and the elimination of waste, all while aiming for complementary “fit” between machines and people. This synthesis—process design plus organizational method—helps explain why some industries experience rapid cost declines while others stagnate.

One of the most compelling chapters examines sectors that have proved unusually resistant to sustained productivity growth, especially housing. While construction costs have risen faster than inflation, labor productivity in homebuilding has not improved commensurately; Potter unpacks why it still takes roughly the same labor hours to build a unit of single-family housing as it did decades ago. He points to the absence of a predictable, standardized environment conducive to mass production—fragmented by zoning codes, permitting requirements, and heterogeneous site conditions. He also explains how factory-built housing faces its own constraints: larger unit sizes and transportation costs, heavy and space-consuming materials, and expensive equipment whose fixed costs are difficult to amortize over sufficiently large output. The result is a stubbornly labor-intensive, craft-based industry vulnerable to “cost disease,” where wages rise with the broader economy without equivalent productivity improvements. Potter’s discussion is especially striking in showing how even Toyota—despite revolutionizing automotive manufacturing—could not make prefabricated housing cheap and ubiquitous after years of effort, underscoring how difficult it is to transplant efficiency methods into environments with high variability and low standardization.

Potter’s history of how production processes are perfected arrives at an especially consequential moment. With the accelerating prominence of AI and advanced automation, his examination—written just before many of these developments began to reshape industrial workflows—feels newly urgent. Using history as a guide, The Origins of Efficiency clarifies that the path to major improvements in living standards runs through practical advances in production: tools and systems that can operate in uncontrolled, variable environments; mechanisms that generate rapid feedback; and scalable approaches that make each additional unit cheaper, faster, and more reliable to produce. In that sense, Potter’s book is not only an economic and industrial history—it is a playbook for where future innovation is most likely to come from, and what it will take to unlock it.

[Pete · Rating 5 out of 5]

The Origins of Efficiency (2025) by Brian Potter is an excellent book about how manufacturing became more and more efficient. Potter is the author of the Construction Physics Substack. He is also a fellow at the Institute for Progress. He was also part of Katerra, a start up that aimed to produce better quality cheaper housing using prefabrication.

The book starts by looking at what are production processes, that is how various things are made. Potter describes how light bulbs were made over time and how their construction cost dropped. He goes through the factors that affect the cost of manufactured items including the amount of materials required and the amount of labor needed to produce a given item. Potter describes how nails were initially handmade, then made by assembly lines just using people and then how machines and power then came into the process. Each step sped up the process and reduced the cost. Finally fully automated systems could produce nails with incredible efficiency.

Potter describes how the Production Rate has improved and how economies of scale can make production more efficient. He uses the example of blast furnaces and the production of iron to describe this. Following on from this he writes about the importance of precision in efficient manufacturing and how reducing variation is critical for improving efficiency. Parts that always fit together are required.

There is a chapter on learning curves that looks at learning curves for transistors, LED lights, solar panels and more and looks at how large volumes make improvements in efficiency worthwhile. Time also helps, but not as much. Potter also describes how batch process and continuous processes improve differently.

Finally Potter looks at areas where there hasn't been that much improvement. The big one of these is housing construction, the very business that Potter worked in. He describes how housing construction produces much smaller numbers of items than car or electronics production and how bulky the final product is. This makes shipping a much higher cost than other forms of manufacturing. He describes how to make housing construction more efficient you effectively need to have machines that can handle variety and work onsite. In other words, robots.

The Origins of Efficiency is an excellent book for anyone who has pondered how humanity has become so efficient at manufacturing. It does focus on manufacturing over other areas. Farming is mentioned, but briefly and the difficulty of improving efficiency in services is also described. But there is little analysis on how those areas can be improved. The book made me think about how volume in manufacturing and the cost per item matters, also how precision and automation can be made to work in manufacturing but why it's so hard to make construction more efficient. Potter also writes well. The book requires no technical knowledge or math skill. The Origins of Efficiency is a delight for anyone interested in manufacturing and how improvement has occurred.

[Tony Huo · Rating 4 out of 5]

- story about pencillin: very small production quantity. had to manually search through thousands of strains to find one that can produce while submerged instead of only on surface. contributed to WW2

- batch process vs continuous process

- AI synergy with 3d printing
In 2023, electrical engineer Heath Raftery documented the process of
trying to 3D print a replacement plastic part for an inexpensive tent. The
part was used to hold the rods of the tent together, and Raftery went
through many rounds of design iteration as he attempted to print a part
that could hold the rods together successfully. After many hours and many
prototype prints, Raftery eventually found that while the design he had
converged on worked when the tent was put together, it failed when trying
to stow the tent in its storage case, which put different forces on the plastic
part. As he wistfully reflected, “lurking within some forgettable $50 Kmart
capitalist wonder is the carefully applied expertise of designers and
engineers.”867 Raftery undoubtedly spent hundreds, perhaps thousands, of
times the cost of the plastic part itself in trying to recreate its design. It’s a
powerful illustration of the problem of scale and repetition: Only over a
large production volume can we economically spread the time and effort
required to design something to successfully perform a task, even if 3D
printing or a similar technology is physically capable of producing it
quickly and cheaply. Without better information-processing technology,
flexible and adaptable production technology won’t reduce costs any more
than cheap penicillin reduced the costs of medical care. The cost of the
process will still be weighed down by the expensive human expertise in
the loop.

[Ed · Rating 4 out of 5]

Lot's of clear explanations and fascinating examples. If you like the construction physics blog you will enjoy this book.

I am grateful that it explains in detail the Toyota Production System because the original TPS book was not clear to me. https://www.goodreads.com/book/show/3...

My main complaint is that there are barely any schematics or photographs, making a lot of the running examples very hard to follow. Eg, there is a running example of lightbulb manufacture.

Workers would start by making the stems, the small glass tubes that connected the wires to the filament. They would then insert the wires into the stems and attach the filament. Then they would affix the exhaust tube to the top of the bulb blank ...

There are paragraphs and paragraphs like this that would be made shorter and clearer with a few carefully chosen schematics.
The author is going into all this effort to describe these lightbulbs to illustrate a general point about efficiency, but it just makes it more confusing because it's so hard to visualise what he means.
It's quite hard to google the relevant schematic too, because the design of modern incandescent lightbulbs is very different to the historical bulbs he describes.

This is a little baffling, because https://www.construction-physics.com/ has huge numbers of pictures, and all the other Stripe Press books I've read go hard on pictures, often in colour.
I would much rather drop some of the text for images if it was a page-length issue, but also this is already a premium book, I don't think any readers are going to complain about having more pictures.

[Kyle · Rating 5 out of 5]

If you enjoy Potter's substack "Construction Physics" then you will enjoy this book (and vice versa). I enjoy it and so found the book to be a well-written exploration of efficiency and efficiency research history. Potter does a great job of using a variety of examples and being careful not to over-theorize or over-sell any results. The author also does a great job of using numbers to show trends without getting bogged down in any specific numbers.

The book follows a clear logical structure starting with what production processes are, various ways to improve them, how this relates to technological advancements and learning, and how this can all come together in some situations to produce cheap, mass-produced goods/services that have massively enriched our lives. He also looks at cases that have resisted continuous manufacturing (or mass production), and some of the reasons for it.

Overall, if you are interested in thinking about how mass production occurred and how people have conceptualized realizing efficiency gains, this is a wonderful volume.

[Edmund Zagorin · Rating 5 out of 5]

Brian Potter's book is an excellent history of automation, and introduction to industrial process fundamentals. Potter covers historical topics ranging from scientific management to time-and-motion studies and brings them to life for current discussions around AI and automation. Efficiency is a fundamental concept for understanding value creation, and yet often discussions of efficiency gloss over its origins, its starts and stops, and the accumulated wisdom from generations of tinkering and experimenting. Potter presents this history in a clean, readable, and enjoyable narrative that should be required reading for the next generation of American manufacturing leaders.

[Steve · Rating 5 out of 5]

Actually 4.5 stars. The book was very informative, and it explained a very complicated subject, manufacturing, quite well and with well-paced writing. There were many examples and case studies that brought the book to life. The addition of charts also helped clarify the information at times. But I also felt that the book read a bit like a textbook, with little about the author’s journey or humour, aspects that would have pushed my rating to 5 stars. Thank you to Edelweiss and Stripe Press for the digital review copy.

[Neil Hunt · Rating 3 out of 5]

A detailed and interesting discussion of the history and potential for manufacturing efficiency

Makes the case that steady progress in efficiency is what built modern society and high standards of living. Speculates how evolving tech could deliver efficiency to sectors so fast relatively impervious to these advances, such as construction, medicine, and education.

Feels a bit like a thesis dissertation, with plenty of detail. An abridged version could have been fine too!

[Jackson Arnold · Rating 4 out of 5]

When I build my widget factory, I have learned that I will need to:

1. Design my widget to reduce variability and simplify production
2. Implement the Toyota Production System
3. Ensure I site my widget factory in a local context close to where I can my most important inputs the cheapest
4. Implement the Toyota Production System
5. Outsource what I can't tightly integrate
6. Implement the Toyota Production System

and especially implement the Toyota Production System.

[Behzad · Rating 4 out of 5]

Delightful read on how improvements in production processes have brought more efficiency over the past three hundred years.

The various approaches presented in the boom explains how technological improvement, reducing the cost of inputs, economies of scale, removing unnecessary steps, and reducing variability and eliminating buffers have create the age of abundance. Worth the time spent reading it carefully.

[Thunderhawke23 · Rating 5 out of 5]

Another great Stripe Press book. A very accessible review of how manufacturing improves

This is yet another great Stripe Press book. Brian writes accessiblly and entertainingly on how production process improve over time and supports it with amazingly detailed notes and stories. A pleasure to read.

[Benjamin Parry · Rating 5 out of 5]

Will write a longer review on www.skillfulnotes.com

In short an exceptional overview of how we have developed efficiency in production esp. manufacturing over the last couple hundred years with not only the theory and a catalogue of techniques but a ton of case studies of what it looks like in practice. Amazing stuff.

[Anne Chen · Rating 2 out of 5]

Wish it had been a little more wonky and a little less colloquial. Or maybe a little more policy and a little less industry. Have I been DCified? In any case I feel a little suckered by how beautiful the book is (full-color graphs?) like those TikTok romances that persuade by screaming their content on the cover

[Gijs Limonard · Rating 3 out of 5]

Expected more from this, some well elaborated points but on the whole it felt like an enumeration (efficient!) of aspects of efficiency in production processes; it sorely lacks an in depth contemplation on what this actually means and what are the drawbacks and very real dangers of applying this way of organizing the world.

[Michael · Rating 4 out of 5]

Very interesting, though some of it was a rehash of things from Potter's blog, not necessarily a critique, but it meant that it wasn't as novel to me as to someone else reading all the material for the first time. Still quite interesting.

[H James · Rating 3 out of 5]

Mr Potter is adept at selecting and narrating illuminating case‐studies for every chapter, but his explanation of concepts is conducted in the numbingly exacting, seemingly redundant manner of a legal contract.

[N · Rating 2 out of 5]

Interesting trivia but this book does not need to exist in a world already saturated with MBAs.

[Bartosz Pranczke · Rating 5 out of 5]

Probably a rather niche topic but for those who are interested in this - very good read.

[Marcin Tokarz · Rating 3 out of 5]

Scratching that Factorio itch.

[Vasil Kolev · Rating 4 out of 5]

Really interesting, and pieces and ideas of it can be applied both to writing/using software, and to the actual workings of software systems.

[Kirk · Rating 2 out of 5]

Mile wide and an inch deep. Just a survey of known facts. No new information.

[Zack Subin · Rating 4 out of 5]

Very clear and thorough but too long and repetitive for a nonspecialist.

[B Dog · Rating 2 out of 5]

Information dense but an incredibly dry book.