What Is RAG? How AI Can Answer Questions From Your Own Documents

You may hear about AI that answers questions using your company's documents. The technique behind it is often called RAG.

AI Business Growth · · 2 min read

The problem RAG solves

General AI models know a lot about the world but nothing specific about your business unless you tell them. Retrieval-augmented generation, or RAG, connects an AI model to a set of documents so it can find relevant information and use it in answers.

How it works simply

When someone asks a question, the system searches your documents for relevant passages, then gives those passages to the AI along with the question. The AI writes an answer based on that retrieved information.

Common business uses

  • Answering employee questions from procedures and handbooks
  • Helping customer service staff find policy details
  • Searching through product information
  • Summarizing information from many documents

Why it can be more accurate

Because answers are grounded in your documents, they can be more accurate and specific than general AI answers. Many systems can also show which document the answer came from.

Limits to remember

RAG is only as good as the documents behind it. Outdated or contradictory documents lead to wrong answers. The AI can still make mistakes, so important answers should be checked.

Easier options for small businesses

Many AI tools now let you upload documents to a project or workspace, which provides a simple version of this capability without technical setup.

Protect sensitive data

Be careful about which documents you upload and who can access the system.

Want This Set Up For You?

AI Business Growth configures ChatGPT, Claude, and simple automations for service businesses, then trains your team to use them. Start with a free evaluation.

Get Your Free AI Evaluation Calculate Your AI ROI

Browse all Small Business AI guides →