Insight series · Part 1 · 14 September 2026 · Part 2 · Part 3 · Part 4
From your question to an answer — AI jargon in plain English
The easiest way to understand the terminology is not as a dry glossary, but as what happens from the moment you type a question until an answer appears.
Think of a business AI assistant like Aadi. You type:
“What is our policy for refunding a customer who cancels after installation has been scheduled?”
Your question → Prompt → Retrieval / RAG → Context → LLM → Response → Checks / actions → You
Here is what each part means.
| Term | Plain English | In our example |
|---|---|---|
| Prompt | The instruction or question given to the AI | “What is our refund policy…?” |
| LLM | The language engine that understands and generates text | Claude, GPT, Llama, Apertus, and similar models |
| Model | The particular engine version in use for this request | e.g. a fast tier for triage, a quality tier for drafting |
| Context | Everything the AI can see for this request | Your question + instructions + relevant company policy |
| RAG | Find relevant information from your knowledge, then give it to the LLM before it answers | Pull the cancellation / refund section from approved documents |
| Embedding | A mathematical representation of meaning, used to find related text | “Customer cancellation” can match “Termination and refunds” even when wording differs |
| Vector database | Storage built to search those meaning-representations quickly | Where searchable copies of your approved knowledge may live |
| Inference | Running the model now to produce an answer | The model reads the supplied information and writes a reply |
| Token | Small chunks of text the model processes internally | Your question and answer are split into tokens — you rarely need to count them |
| Hallucination | Plausible-sounding output that is not supported or is wrong | Inventing a 14-day refund rule that is not in your policy |
| Guardrail | Rules and checks on what the AI may do or say | “Do not invent policy; escalate if evidence is missing” |
| Agent | AI given a job and some ability to choose steps or tools | Retrieve policy before answering, or ask for approval before sending |
| Tool | Something the AI can use beyond generating text | Search documents, query a CRM, calculate a price, draft an email |
| API | A defined way for one system to talk to another | Aadi asking your CRM for installation status |
| Workflow | The sequence of steps to complete the job | Identify customer → check status → retrieve policy → prepare response |
| Agentic AI | AI that can decide and execute several steps towards an objective | “Handle this cancellation” rather than only “What is our policy?” |
Follow one question all the way through
You ask Aadi:
“Can Mrs Smith cancel her solar installation and get her deposit back?”
1. Your question becomes part of the prompt
A prompt is not always just what you typed. The system may add instructions such as:
You are the customer assistant for this organisation. Use approved company information. Do not invent contractual terms. Escalate when uncertain.
So there is a user prompt (what you asked) and often a system prompt (how the assistant should behave).
2. The system works out what information it needs
The LLM knows a great deal of general knowledge from training, but it does not automatically know your latest contract terms or Mrs Smith's particular case.
That is where RAG — retrieval-augmented generation matters. The name sounds complicated; the idea is simple:
Retrieve the right information first; then give it to the AI to help generate the answer.
3. RAG searches your knowledge
Suppose your business has hundreds of documents. Instead of sending all of them to the LLM, the system searches for pieces most relevant to:
cancellation + solar installation + deposit refund
Embeddings help match meaning, not just keywords. A vector database is commonly used to store and search those representations.
The system might retrieve:
Customer terms, section 7.2 — cancellation after installation scheduling…
That material is added to the context for the LLM:
- your question
- instructions
- relevant retrieved company information
4. The LLM reasons over context and generates language
The LLM — large language model — is the language intelligence at the centre. It might conclude that Mrs Smith may be entitled to cancel, but whether the full deposit is refundable depends on costs already incurred.
Running the trained model to produce that answer is inference. That is different from training:
- Training — building or improving the underlying model from large datasets
- Inference — using the already-trained model to answer something now
When someone asks, “Is my company data being used by the AI?”, using company data as context for inference is not the same as using it to train the model. Policy, contracts, and architecture decide what actually happens — ask, do not assume.
From assistant to agent
Suppose instead you say:
“Deal with Mrs Smith's cancellation.”
Generating an answer alone is not enough. A digital worker might need to:
- identify Mrs Smith in the CRM
- check contract and installation status
- retrieve cancellation policy
- calculate any allowable deduction
- prepare confirmation
- ask a human to approve
- update systems and send confirmation
That is agentic AI — the LLM is still important, but it sits inside a larger system.
A useful split:
- LLM — intelligence
- RAG — access to relevant knowledge
- Tools — ability to interact with other systems
- Workflow — defined process
- Agent — intelligence using knowledge and tools to pursue a job
- Guardrails — boundaries on what it may do
That maps to how we talk about Aadi:
Process → job → digital worker → outcome
The LLM is not the product in that picture. It is one important component inside the worker — alongside models, knowledge, tools, workflows, permissions, and governance.
RAG vs training (often confused)
Imagine giving a new colleague your handbook. You have not retrained their brain; you gave them something to consult. That is broadly the intuition behind RAG.
Training or fine-tuning changes the model itself. RAG usually leaves the base model alone and supplies relevant information when needed.
When somebody says, “We trained our chatbot on all our company documents,” they often mean:
“We indexed our documents and use RAG to retrieve relevant information for the model.”
Those are technically different things.
One mental picture
- Prompt — what I'm asking
- Context — what the AI can see right now
- RAG — how it finds relevant knowledge
- LLM — the language / reasoning engine
- Inference — the engine running
- Tools — what it can use
- Agent — LLM + context + tools + objective
- Guardrails — what it is allowed to do
- Workflow — how the job should proceed
- Digital worker — all of that packaged around a defined business job
You are not buying access to an LLM.
You are packaging models, knowledge, tools, workflows, permissions, and governance around work that needs to get done.
Ask Agent Aadi on the home page — or request a walkthrough via hello@agent-aadi.io.
Series: Part 1 (this page) · 2 · 3 · 4 · governed digital workers