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What is generative AI?

Discover how generative AI creates new content by learning patterns from existing data.
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How does AI work?

AI started with simple rules that computers had to follow exactly. It evolved into machine learning, allowing systems to learn from data. Today, AI automates tasks, analyzes data, and solves complex problems across various industries.

What does generative AI do?

While conventional AI typically analyzes data to find patterns, generative AI works differently—it creates new data. Gaining a deeper understanding of generative AI can help organizations successfully adopt the technology.

Instead of following set rules, generative AI studies the basic structure of training data and uses advanced machine learning to generate new content. This lets it make new outputs that match what it's learned.

Here’s what generative AI does:
  • It creates new content like text, images, and videos based on patterns in existing data.
  • It learns complex structures by analyzing large datasets to understand relationships within the data.
  • It adapts and improves over time by continuously learning from new data, making its outputs more refined.

Explore three types of generative AI

Generative adversarial networks (GAN)

GANs consist of two networks—a generator and a discriminator—that compete against each other. The generator creates fake data, while the discriminator evaluates it against real data. The goal is for the generator to produce data indistinguishable from real data.
  • Generator: Creates synthetic data based on training.
  • Discriminator: Evaluates the data and provides feedback to the generator.
 
GAN examples
  • Deepfake technology: GANs can make real videos or images by learning facial movements and expressions. However, these applications raise ethical concerns.
  • Image synthesis: In industries like fashion or gaming, GANs create high-quality images for product design or character creation.
  • Collaborative art tools: Certain platforms allow people to create new art pieces or realistic portraits by combining existing images using GAN technology. 

Variational autoencoders (VAE)

VAEs are models that reduce the size of data while keeping its important parts. They then make new data based on that reduced representation. VAEs are commonly used for tasks like:
  • Data compression: Efficiently compress large datasets for easier storage and processing.
  • Image denoising: Improve the quality of low-resolution or noisy images by generating clearer versions.
  • Medical imaging: Enhance MRI and CT scan images, offering clearer visuals for diagnosis. 

Transformers

Transformers are a popular architecture in natural language processing and are foundational for language models like GPT-3. These models generate text by predicting the next word in a sentence based on previous context. They operate by using the following methods:
  • Attention mechanisms: Transformers use self-attention to weigh the importance of each word in a sentence.
  • Language understanding: Transformers grasp context and relationships between words to generate accurate text.
 
Transformer applications
  • Content generation: Write articles, reports, and other forms of creative content with models like GPT-3.
  • Language translation: Translate text from one language to another with high accuracy.
  • Chatbots: Provide human-like responses in real time for applications like customer support.  

What can generative AI do?

Healthcare

Generative AI is transforming healthcare by revolutionizing how new drugs are developed and how treatments are personalized to individual patients.
   
  • Drug discovery: AI models can suggest potential drug compounds by analyzing millions of data points from biological research. This AI-driven approach dramatically reduces the time it takes to identify promising drugs, helping companies move from concept to clinical trials faster. 
 
  • Personalized medicine: Generative AI models analyze patient data—including genetic, lifestyle, and medical history—to create customized treatment plans. AI helps doctors make more informed decisions that align with a patient’s specific needs. AI powered solutions like Dragon Ambient eXperience (DAX) Copilot can help clinicians be more productive and efficient with AI-based note creation.

Finance

In the financial industry, generative AI is being used to manage risk and find fraud. This helps banks and financial institutions work more safely and efficiently.
   
  • Risk assessment: AI models simulate various market scenarios to predict potential outcomes. By simulating thousands of market conditions, AI helps the bank to foresee possible financial risks and adjust strategies accordingly.
  • Fraud detection: Generative AI models identify fraudulent transactions by detecting unusual patterns in financial data. Banks can use AI to monitor and analyze billions of transactions in real time, flagging suspicious activities and generating alerts when irregular patterns are found. The AI helps prevent fraud before it escalates, saving significant costs and protecting customer accounts.
  • Optimized financial processes: Tools like Microsoft 365 Copilot for Finance can help improve efficiency by applying AI to labor-intensive processes like collections as well as contract and invoice capture. 

Manufacturing

In the manufacturing industry, generative AI is revolutionizing production processes and quality control. This leads to more efficient operations and higher-quality products.
   
  • Predictive maintenance: AI models analyze data from machinery to predict when maintenance is needed. By identifying potential issues before they cause breakdowns, AI helps reduce downtime and extend the lifespan of equipment.
  • Quality control: Generative AI systems inspect products for defects by analyzing images and sensor data. This ensures that only high-quality products reach the market, reducing waste and improving customer satisfaction.

Retail

In the retail sector, generative AI enhances customer experiences and helps optimize inventory management so retailers can meet customer demands more effectively and efficiently.
   
  • Personalized recommendations: AI models analyze customer data to provide personalized product recommendations. By understanding individual preferences, AI helps retailers offer more relevant products, increasing sales and customer loyalty.
  • Inventory optimization: Generative AI predicts demand for products, helping retailers manage their inventory more effectively. By ensuring that popular items are always in stock and reducing overstock of less popular items, AI helps retailers minimize costs and maximize profits.

Education

Generative AI can help transform teaching and learning methods, providing tailored educational experiences for students.
 
  • Personalized learning: AI models analyze student performance data to create customized learning plans. By identifying areas where students need improvement, AI helps educators provide targeted support, enhancing student outcomes.
  • Automated grading: Generative AI systems grade assignments and exams by analyzing student responses. This reduces the workload for educators and provides students with faster feedback, allowing them to learn and improve more quickly.

Content creation

Generative AI offers a wealth of new tools and possibilities for artists in a broad range of creative fields. 
  • Writing: Writers can draft articles, blog posts, or even full-length novels with AI tools. Content creators can automate boring tasks like summarizing information or making outlines. This lets them focus on the more detailed and creative parts of writing.
  • Music: Musicians can add certain settings or genres to create new songs. They can then use AI-generated melodies as inspiration or a base for more music.
  • Photography: Photographers can enhance and edit photos with generative AI tools that create new images. They can change the lighting and colors, and even make new images based on existing ones.
  • Videography: Videographers can create special effects, produce realistic animations, and craft entire video sequences from scratch, making the production process more efficient and creative.
  • Art: Artists can collaborate with generative AI to create entirely unique pieces that push the boundaries of traditional creativity. AI can offer new styles and concepts, giving artists fresh perspectives and innovative ideas.
     
  Creative industry benefits
  • Increased experimentation: Artists can quickly draft variations of their work to explore different styles or approaches.
  • Collaborative creation: Creators work alongside AI as a collaborative tool, getting help with brainstorming and other drafting tasks.
  • Speed: Creators can use AI to accelerate processes like music composition or drafting written content, significantly reducing production time.
  • Accessibility: By automating complex aspects of content generation, creators with limited resources or technical skills can produce high-quality work.
  • Experimentation: Artists can experiment with new ideas and styles without the constraints of traditional methods.
  • Collaboration: AI can act as a creative partner, offering suggestions and generating content that can be refined by human creators.
  • Efficiency: Creators can speed up the production process, allowing them to focus on refining and perfecting their work rather than starting from scratch. 

Innovation and creativity

Generative AI brings new solutions and efficiencies to various creative tasks.
  • Streamlined creative processes: Generative AI helps creators automate repetitive tasks, allowing more time for innovation. Artists, writers, and musicians can focus on refining their work while AI handles the groundwork.

Example: A novelist working on a new book uses generative AI to draft initial chapters based on that author’s style, freeing her up to focus on refining the plot and characters.

  • Novel solutions: By analyzing vast datasets, generative AI can create novel solutions to problems. This includes designing new products, drafting marketing copy, or creating solutions in science and engineering.
     

Example: A product designer tasked with creating a new line of eco-friendly packaging uses generative AI to analyze large datasets of materials and consumer preferences before suggesting sustainable, innovative designs.

 

Efficiency and productivity

The benefits of generative AI include broad gains in productivity measures.
  • Automated content creation: Businesses can automate the creation of text, images, or code, drastically reducing the time needed to produce content. This allows teams to focus on higher-level tasks and strategic planning.
     
Example: A marketing agency uses generative AI to create social media posts, blog articles, and promotional images. The AI helps analyze trends and audience preferences to create content that resonates with the target market.
 
  • Time and cost savings: By using AI to automate creative and technical tasks, businesses save costs and speed up workflows. This reduces the need for extensive human labor in some areas, leading to more efficient operations.
     
Example: A software development company employs generative AI to write and debug code. When working on a new application, the AI can help create the initial code structure, allowing developers to focus on more complex and creative aspects of the project.

Personalization

Businesses are using AI to improve customer experiences.

Tailoring experiences and products: AI can help create personalized content, from product recommendations to tailored marketing emails, enhancing the customer experience. This level of personalization helps businesses connect with their audience on a deeper level, fostering loyalty and engagement.

Example: A retail company uses generative AI to create personalized shopping experiences for its customers. The AI analyzes each customer's browsing history, purchase patterns, and preferences to create tailored product recommendations, making the shopping experience more engaging and relevant.

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Frequently Asked Questions

  • Generative AI models come in several main types. GANs consist of two networks—a generator and a discriminator—that compete against each other. The generator creates fake data, while the discriminator evaluates it against real data. VAEs compress data into a latent storage space and then generate new data based on that compressed representation. They're commonly used for tasks like data compression and denoising. Transformers, popular in natural language processing, generate text by predicting the next word in a sentence based on previous context.
  • Generative AI creates new data, while traditional AI models, like discriminative AI, focus on classification and prediction. Generative AI learns patterns from existing data to produce new content, whereas discriminative AI distinguishes between different categories of data. For more details, check out our article on generative AI versus other types of AI.
  • Generative AI is most suitable for data that has clear patterns and structures, such as text, images, and audio. It excels in creating new content based on these patterns, making it ideal for applications in creative industries, healthcare, and finance.
  • Generative AI is used across various industries:
    • Entertainment: Creating new music, art, and video content.
    • Healthcare: Drug discovery and personalized medicine.
    • Finance: Risk assessment and fraud detection. 
    For more use cases, explore real world customer stories
  • Generative AI is good at creating new and original content. It can generate text, images, music, videos, and even code. This capability makes it a powerful tool for innovation and creativity across multiple fields.

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