Generative AI

Definition

Generative AI is software that creates new content, such as text, images, audio, video or code, from a plain-language request. It learns patterns from large amounts of existing examples and produces fresh output that follows those patterns.

By Ronan Liedmeier, fractional head of growth and course author · Published 17 October 2026 · Last updated 17 October 2026

Also called: GenAI, gen AI

Chat assistants and image generators both fall under the label. At work most people meet it as a chat box, yet the same models can draft documents and, once connected to other tools, take actions for you.

How it differs from other AI

Older business AI mostly sorted or scored things that already existed: flagging a payment as likely fraud, or predicting which customers will cancel. Generative AI produces something that did not exist a minute ago, such as a paragraph or a product photo.

Text tools run on a large language model. Image and video tools use models trained on pictures and their descriptions. Many current models are multimodal, so one model can look at an image and write about it.

Example

A two-person shop selling ceramic mugs online uses a chat assistant to write 30 product descriptions from a spreadsheet of sizes and glaze names. The owner edits them for tone, then uses an image tool for lifestyle mockups on the homepage. She keeps lettering out of the generated images, since text inside AI pictures tends to come out garbled.

Common mistake

Using it like a slightly smarter Google search and closing the tab after one answer. That misses most of what it does well, which is producing and reworking drafts you can check. It is also where people get burned, because a generated answer about facts can be wrong while sounding certain. Ask for a draft, push back on it with follow-ups, and check any facts before you use them.

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Related terms

Large language model (LLM)
A large language model (LLM) is an AI system trained on huge amounts of text to predict which words should come next. At scale, that one skill lets it answer questions, summarize, translate and write in a way that reads like a person wrote it.
Multimodal AI
Multimodal AI is AI that can work with more than one kind of input or output, such as text, images, audio and video, in the same conversation. You can show it a photo or screenshot and ask about it, or describe a picture and get one made.
AI image generation
AI image generation is the use of an AI model to create a new picture from a written description, or to edit an existing image by describing the change you want. You describe the subject, style and format in plain words, then refine the result in follow-up messages.
AI agent
An AI agent is an AI system that works toward a goal by choosing its own next steps: it picks a tool, uses it, looks at the result and repeats until the task is done. You set the goal and the limits, and the agent works out the path.

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