AI glossary for business owners
The words chatbot vendors use and rarely explain: agent, RAG, token, MCP. Each one gets a one-line definition, a plain explanation and an example right inside a shop.
- 40 terms
- 12 new words
- terms
- 40
- groups
- 5
- new words
- 12
The dictionary at a glance
12 new words since 2024
40 terms. Accents are optional when you search.
Basics
The first words you meet when you start using AI.
- BasicsArtificial intelligence (AI)Artificial intelligence (AI) is software that does things that used to need a person thinking: reading, seeing, guessing, writing and answering.Read the term
- BasicsMachine learningMachine learning is a way for machines to work out patterns from many examples, instead of a person writing every rule for them.Read the term
- BasicsDeep learningDeep learning is a branch of machine learning that uses many-layered neural networks, and is good with complex data such as images, voice and text.Read the term
- BasicsNeural networkA neural network is a computer model made of many connected nodes in layers, inspired by the way neurons in the brain pass signals.Read the term
Agents and automation
When AI stops just answering and starts doing.
- Agents and automationChatbotA chatbot is a program that chats automatically: customers ask and it answers in the chat window, from a fixed script or from prepared documents.Read the term
- Agents and automationAI agentAn AI agent is AI given a goal that takes several steps on its own to reach it: looking things up, using tools, checking the result and reporting back.Read the term
- Agents and automationTool useTool use (function calling) is AI calling an outside function, such as checking stock, pricing delivery or creating an order, instead of only writing text.Read the term
- Agents and automationAPIAn API is a doorway that lets two pieces of software talk to each other by agreed rules, for example so AI can read orders or post to social media.Read the term
Data and accuracy
Why AI gets things right, and why it sometimes makes things up.
- Data and accuracyKnowledge baseA knowledge base is the set of the shop's own documents that AI is allowed to look up: prices, policies and frequently asked questions.Read the term
- Data and accuracyRAGRAG (retrieval-augmented generation) is letting AI find and read your documents before it answers, instead of answering from memory.Read the term
- Data and accuracyEmbedding (vector)An embedding (vector) is a way of turning text into a list of numbers so a machine can tell how close two meanings are, even when the words differ.Read the term
- Data and accuracyFine-tuningFine-tuning is teaching an existing AI model more with your own examples, so it picks up your voice or gets good at one task.Read the term
Risks and safety
What to fence in before you hand work to AI.
- Risks and safetyGuardrailsGuardrails are hard rules around AI so it does not say or do things outside its remit, such as giving a bigger discount than allowed.Read the term
- Risks and safetyPrompt injectionPrompt injection is when someone hides instructions in a message or document to trick an AI into doing what they want.Read the term
- Risks and safetyDeepfakeA deepfake is a fake image, voice or video made by AI that looks like a real person or event, often hard to tell apart.Read the term
- Risks and safetyData privacyData privacy, when using AI, is about where customer and shop data sent to the AI goes, who can see it and how long it is kept.Read the term
New in 2025–2026
Fresh words AI vendors have started using everywhere.
- New in 2025–2026New 2025Agentic AIAgentic AI is the umbrella name for AI systems that plan and carry out several steps on their own to finish a job, instead of waiting for each instruction.Read the term
- New in 2025–2026New 2024Reasoning modelA reasoning model is an AI model that takes time to "think" through several steps before answering, so it handles harder problems better.Read the term
- New in 2025–2026New 2025Context engineeringContext engineering is choosing the right information to give an AI at each step: enough to do the job, nothing extra to confuse it.Read the term
- New in 2025–2026New 2024Computer useComputer use is an AI agent looking at the screen, clicking, typing and filling in forms like a person, even on sites without an API.Read the term