Chifty
Glossary
Company knowledge
Company knowledge is the entirety of the knowledge that exists within a business – from documented information such as contracts, guides, and process descriptions to the practical experience of its employees. For small and medium-sized businesses it is a central resource: it lives in emails, files, and people's heads, and shapes how quickly tasks get done and questions get answered.
Knowledge management
Knowledge management is the systematic handling of an organization's knowledge: capturing, structuring, sharing, and keeping it up to date so it remains available independently of individual people. It matters especially for small and medium-sized businesses, where experience is often concentrated in a few heads and can be lost when employees leave.
Knowledge base
A knowledge base is a central, searchable collection of company knowledge – documents, guides, policies, and answers to common questions. It makes scattered knowledge findable and independent of individual people. For small and medium-sized businesses, it is the foundation for sharing knowledge across the team, onboarding new employees faster, and grounding AI applications in reliable sources.
RAG (Retrieval-Augmented Generation)
RAG (Retrieval-Augmented Generation) is a technique in which an AI language model retrieves relevant content from a knowledge source before answering and grounds its response in those passages. Instead of relying on training data alone, the model uses current, company-owned documents. For SMEs, this means answers are based on their own knowledge and can be verified through source references.
Permission-aware AI
Permission-aware AI refers to AI systems that take the access rights of the asking person into account on every request and draw only on sources that person has been granted access to. For small and medium-sized businesses this is essential: sensitive areas such as HR, finance, or management stay protected even when an AI can search the company's entire knowledge.
GDPR and AI
GDPR and AI refers to applying the EU General Data Protection Regulation to artificial intelligence systems: personal data may only be processed with a legal basis, a defined purpose, and data minimisation. For small and medium-sized businesses, this means clarifying before adopting an AI tool which data it processes, where that happens, and whether a data processing agreement under Art. 28 GDPR is in place.
DPA (Data Processing Agreement)
A data processing agreement (DPA) is a contract under Art. 28 GDPR between a controller and a processor that handles personal data on the controller's behalf. It defines the subject, duration, nature, and purpose of processing as well as technical and organizational measures. SMEs need one whenever external providers such as cloud or AI services process personal data for them.
On-premise AI
On-premise AI refers to running AI systems on a company's own infrastructure rather than in a vendor's cloud. Data, models, and compute stay under the organization's direct control. For small and medium-sized businesses, this matters most when highly sensitive data must not leave the premises or internal policies restrict cloud use.
AI hallucination
An AI hallucination is output from an AI language model that sounds plausible and convincing but is factually wrong or entirely made up. For small and medium-sized businesses this matters because such errors can slip unnoticed into quotes, customer replies, or internal research. The most effective countermeasure is grounding answers in verified sources.
EU AI Act
The EU AI Act (Regulation (EU) 2024/1689) is the European Union's regulation on artificial intelligence. It governs AI systems using a risk-based approach — from prohibited practices and high-risk systems to transparency obligations. For small and medium-sized businesses, the labelling duties for certain AI-generated content, in effect since 2 August 2026, are especially relevant.
Zero data retention
Zero data retention is a contractual commitment by an AI provider not to permanently store incoming requests and their content after processing. Prompts, documents, and responses are used only to produce the answer and are not kept afterwards. For small and medium-sized businesses this matters because confidential company data does not remain in the AI provider's systems.
Prompt
A prompt is the input a person gives an AI system to set a task – a question, an instruction, or a writing brief with context. How precisely a prompt is worded largely determines the quality of the answer. For small and medium-sized businesses, good prompting is therefore a core skill for everyday work with AI tools.