Perspectives

What is Generative AI versus AI?

The CLO’s guide to Generative AI risks and opportunities

What Generative AI is

Generative AI (GenAI) is a subset of AI that empowers machines to imitate the creative human process to produce original content such as text, images, code, voice, and video rather than merely interpreting existing data.1 GenAI has the potential to add contextual awareness and humanlike decision making to enterprise workflow. It is powered by large datasets or foundation models, and the algorithms utilized to interpret this data are modeled after the neurons of the human brain. GenAI is different from earlier iterations of AI in three key ways.

01. It’s trained on a large set of data.

02. It’s designed to respond to natural language instructions.

03. It can generate unique content that looks and sounds like it was created by a human.2

What Generative AI is not

Various forms of AI were in use before the advent of GenAI. While these technologies could automate tasks, uncovering patterns and correlations, and making predictions about the future based on current and historical data, the precursors to GenAI lacked the ability to mimic the human creative and decision-making processes that appear to have the same fidelity as human-created-artifacts.3 The following list is representative of traditional AI, but not GenAI.

01. Intelligent automation

02. Predictive analytics

03. Machine learning

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Other Generative AI topics to explore

Learn about other areas of Generative AI and how it impacts CLOs and their teams. From the basics to the more complex challenges, these resources are designed to help you navigate GenAI’s legal implications and risks with ease. 

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1 Deloitte, "Benefits and limitations of Generative AI," 2023; Artificial Intelligence Act, "The Artificial Intelligence Act - Regulation (EU) 2024/1689," accessed June 14, 2023. 

2 Beena Ammanath et al., Generative AI is all the rage, Deloitte AI Institute, 2023.

3 Gopal Srinivasan et al., A new frontier in artificial intelligence, Deloitte AI Institute, 2023.

Get in touch

J. Donald Fancher

Principal - Deloitte Risk & Financial
Advisory | Leader -
Chief Legal Officer Program
Deloitte Financial Advisory Services LLP

dfancher@deloitte.com

Jon Foster

Managing Director | Deloitte Risk &
Financial Advisory
Deloitte Transactions and
Business Analytics LLP

jonfoster@deloitte.com

Erin Hess

Research and Insights Manager
Chief Legal Officer Program
Manager | Deloitte Risk &
Financial Advisory
Deloitte Transactions and
Business Analytics LLP

erhess@deloitte.com

This document contains general information only and Deloitte is not, by means of this document, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This document is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.

Deloitte shall not be responsible for any loss sustained by any person who relies on this document.

As used in this document, “Deloitte” means Deloitte Financial Advisory Services LLP, which provides risk and financial advisory services, including forensic and dispute services; and Deloitte Transactions and Business Analytics LLP, which provides risk and financial advisory services, including eDiscovery and analytics services. Deloitte Transactions and Business Analytics LLP is not a certified public accounting firm. These entities are separate subsidiaries of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of our legal structure. Certain services may not be available to attest clients under the rules and regulations of public accounting. Deloitte does not provide legal services and will not provide any legal advice or address any questions of law.

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