AI Glossary

Generative AI

Generative AI is a class of artificial intelligence that creates new content — text, images, audio, video or code — by learning patterns from large datasets and producing original output in response to a prompt.

Definition

Generative AI is artificial intelligence that produces new content rather than only classifying or predicting. Give it a prompt — a question, an instruction, a sketch, a few examples — and it generates text, images, audio, video or software code that did not exist before.

Traditional "predictive" AI answers narrow questions: is this email spam, will this customer churn, what is in this photo. Generative AI answers open-ended requests: write this email, summarise this report, draw this product concept, explain this spreadsheet formula. That shift from labelling to creating is why generative AI spread so quickly into everyday office work.

The best-known generative AI tools are chat assistants built on large language models, image generators built on diffusion models, and coding assistants that suggest and write software.

How generative AI works

Learning patterns from data

Generative models are trained on very large collections of examples. A language model reads huge amounts of text and learns, statistically, which tokens tend to follow which. Most modern language models use the transformer architecture introduced in the 2017 paper Attention Is All You Need.

Generating one piece at a time

When you send a prompt, a language model predicts the most plausible next token, adds it, and repeats until the answer is complete. Image models work differently — diffusion models start from random noise and gradually refine it into an image matching the prompt — but the principle is the same: generate output that fits the patterns learned in training.

Shaped by instructions and context

The same model can draft a legal summary or a birthday poem because its behaviour depends on the prompt and the information supplied in its context window. This is why prompt engineering and techniques such as retrieval-augmented generation matter so much in practice.

Why generative AI matters at work

The research picture is clear on two points: generative AI can deliver large gains on the right tasks, and it can make people worse on the wrong ones.

Types of generative AI

TypeWhat it createsTypical work use
Text (LLMs)Emails, reports, summaries, answersDrafting, summarising, research starting points
CodeFunctions, scripts, formulasSpreadsheet formulas, automation, software
ImageIllustrations, mock-ups, photosMarketing visuals, concepts, presentations
AudioSpeech, voice, musicVoice-overs, transcription and dubbing
VideoShort clips, animationsTraining videos, social content
MultimodalMixed inputs and outputsReading charts, describing images, analysing documents

Strengths and limits

Strengths: speed, fluency, breadth of general knowledge, tireless iteration and the ability to restructure information into almost any format.

Limits:

Example

Marta runs customer communications for a mid-sized logistics company. Every week, her team answers dozens of near-identical emails about delivery delays, and every quarter she writes a customer newsletter.

She starts with low-risk work. Using her company's approved assistant, she asks it to draft five reply templates for common delay scenarios, giving it context (B2B customers, a formal but warm tone), the company's actual delay-compensation policy pasted into the prompt, and a requirement to keep each reply under 120 words. The drafts are good, but one template promises a refund the policy does not allow. Marta catches it because she checks every commitment against the policy, then adds "never promise anything not stated in the policy" to the prompt.

For the newsletter, she uses an image generator to create a header illustration and the assistant to turn bullet points from operations into readable paragraphs. She edits the final text herself and has a colleague review it before sending.

After a month, her team reports — by their own timing — that drafting a delay reply takes a few minutes instead of a quarter of an hour, and that the newsletter takes one afternoon instead of two days. The policy check stays mandatory.

How to start using generative AI: step by step

  1. Read your organisation's AI policy. Find out which tools are approved and what data they may receive.
  2. Pick a low-risk, repeated task. Drafting, summarising, rewriting and brainstorming are good first choices.
  3. Prepare your input. Remove personal or confidential data you are not permitted to share.
  4. Write a structured prompt. Give context, a role, a clear ask, a format and a tone — the CRAFT framework is one way to remember this.
  5. Supply the facts. Paste the policy, data or document you want the answer based on, instead of relying on the model's memory.
  6. Add an example when format matters. One or two samples of the output you want improve consistency — see few-shot prompting.
  7. Iterate. Ask for specific changes: shorter, more formal, as a table, for a different audience.
  8. Verify everything that matters. Names, numbers, dates, quotes, citations and commitments.
  9. Keep a human accountable. Decisions about people, money and legal matters need a human in the loop.
  10. Save and measure. Store prompts that work and note the time saved and errors caught.

Common mistakes

Key takeaways

How this relates to our AI course

AI POWERED is a practical course in using generative AI at work: free Module 1 explains how these models work and teaches the CRAFT prompting framework, and later modules cover verification, the SAFE data rules and workflows. Every module ends with a 10-question test at an 80% pass mark.

Start free Module 1 →

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