Combined efficiency is the number of points a team would gain or lose in 100 possessions. Take a team's offensive efficiency and subtract the defensive efficiency.
Combined Efficiency = OE - DE
Continuing with the 2016 Title Game as an example, Villnova's offensive efficiency was 120 and its defensive efficiency was 115.
Villanova's combined efficiency is 5.
Combined Efficiency = 120 - 115 = 5
This gives a team 1 efficiency number instead of 2. It can be described as a glorified margin of victory.
Villanova's combined efficiency is 5. It won the game by 3.
Remember the game didn't feature 100 possessions. Combined efficiency accounts for 100 possessions. If it did, this suggests Villanova would of won by 5.
Offensive and defensive efficiency tell you how effective a team is based on the four factors. Combined efficiency leaves a lot unknowns as to why a team is good or bad.
If all you're given is a combined efficiency of 5, it's hard to know if a team is good offensively or defensively, and what factors are leading to that success.