A glossary of AI terms for B2B companies
The terms that come up most often in AI proposals and articles, explained in a sentence or two. Where a fuller piece exists, we link to it.
- LLM (large language model)
A model trained on a large body of text that predicts the continuation of an input. It knows language and general knowledge from training; it does not know your company data unless you supply it.
- RAG (retrieval-augmented generation)
An architecture where the system retrieves relevant passages from your documents before answering and attaches them to the question. The model then answers from your data and can cite the source.
In full: What RAG is and how it works in enterprise chatbots- AI agent
A system that plans and carries out several steps on its own to reach a goal, including calling external tools and writing to company systems. Unlike a chatbot it does not just answer, it acts.
In full: What an AI agent is and how it differs from a chatbot- Chatbot
An interface that answers questions within a single conversation and takes no action outside it. Suited to informational questions, not to getting work done.
In full: What an AI agent is and how it differs from a chatbot- Fine-tuning
Further training of a model on your own data, which changes its behaviour or style. For adding factual knowledge that changes often, RAG is the better fit.
In full: What RAG is and how it works in enterprise chatbots- Embedding
The conversion of text into a numeric vector that captures its meaning. Two texts with similar meaning have nearby vectors, which is what allows search by sense rather than by word match.
In full: What RAG is and how it works in enterprise chatbots- Vector database
A database optimised for retrieval by semantic similarity between vectors. At smaller volumes an extension to your existing database, such as pgvector in PostgreSQL, is enough.
In full: How a multi-tenant vector database serves many clients at once- Chunking
Splitting documents into smaller pieces before indexing. Pieces that are too large or too small both reduce retrieval precision; a badly split table is a common cause of nonsense answers.
In full: What RAG is and how it works in enterprise chatbots- Multi-tenant
An architecture where one infrastructure serves several clients while each client's data stays separate. The separation is enforced by metadata filtering at the retrieval layer.
In full: How a multi-tenant vector database serves many clients at once- Metadata filtering
Restricting retrieval by a document's tags, such as client, department or access level. It has to happen before retrieval, not after it.
In full: How a multi-tenant vector database serves many clients at once- Hallucination
A factually wrong answer delivered with high confidence. The risk drops when the answer rests on a specific source document that can be checked.
In full: Security risks when deploying an LLM into company processes- Prompt injection
An attack where instructions are planted in input data, such as an email or a document, to push the system off its task. Defended against by separating instructions from data and limiting permissions.
In full: Security risks when deploying an LLM into company processes- Token
The unit text is split into for the model to process, roughly a fragment of a word. API running costs are billed per token, so they rise with how much the system is used.
In full: What a custom AI agent costs to build for a B2B company- On-premise and EU-hosted deployment
Running the system on your own infrastructure or within the EU instead of a public cloud API. Mainly relevant for healthcare, legal and finance, where data must not leave the controlled environment.
In full: Security risks when deploying an LLM into company processes- EU AI Act
European regulation of AI systems introducing transparency and risk-management requirements according to a system's risk category. Some company deployments in sensitive sectors can fall into a higher category.
In full: Security risks when deploying an LLM into company processes
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