AI and automation glossary

Accounts payable (AP) is the money a company owes suppliers for goods and services bought on credit, and the finance function that receives, approves and pays those invoices.

Accounts receivable (AR) is the money customers owe a company for goods or services delivered on credit, and the finance function that invoices, collects and records those payments.

Accruals are accounting entries that record revenue earned or expenses incurred in a period before cash moves or an invoice arrives, so the books reflect the period the activity belongs to.

Agentic AI describes systems where AI plans and carries out multi-step tasks on its own, using tools and feedback, instead of only answering one prompt at a time.

An AI agent is software that uses a language model to choose its own next steps, call tools like APIs and databases, and work toward a goal with limited supervision.

AI guardrails are the checks and limits around an AI system, such as input filters, output validation, permission scopes and approval steps, that keep its behavior inside defined bounds.

An AI hallucination is output from a language model that sounds plausible but is false or unsupported, such as an invented citation, figure or policy.

AI orchestration is the control layer that sequences steps, routes work between models, tools and people, handles retries and errors, and keeps state across a multi-step workflow.

An AI readiness assessment is a structured review of whether an organization's data, processes, systems, people and risk controls are ready for a specific AI project, ending in a scored result and a recommended first step.

An AI receptionist is a voice or chat system that answers incoming calls and messages for a business, handles routine requests such as booking and FAQs, takes messages and transfers urgent calls.

AI sales development representative

An AI SDR is software that handles sales development tasks, such as researching prospects, writing outreach, following up and booking meetings, often with a person reviewing the messages.

Accounts payable automation

AP automation uses software and AI to capture supplier invoices, extract and code the data, match it to purchase orders, route approvals and prepare payment with minimal manual entry.

Application programming interface

An API (application programming interface) is a defined way for one piece of software to request data or actions from another, usually over HTTP with structured JSON.

An audit trail is a chronological, tamper-resistant record of who or what did what, when and why in a system, used to review, investigate and prove how a decision was made.

Business process management

Business process management (BPM) is the discipline of modeling, running, monitoring and improving a company's business processes, and also the name for the software suites that execute those process models.

Business Process Model and Notation

BPMN, short for Business Process Model and Notation, is a standard graphical notation for drawing business processes with events, tasks, gateways and flows, maintained by the Object Management Group.

Business process automation (BPA) is the use of software to run whole business processes, such as onboarding or invoice approval, across systems and teams using defined rules.

Cash application is the accounts receivable step of matching incoming customer payments to the open invoices they settle, so each invoice is closed and the customer's balance is correct.

Contract lifecycle management

Contract lifecycle management (CLM) is the process, and the software, for handling contracts from request and drafting through negotiation, approval, signature, obligation tracking and renewal.

Containment rate is the share of customer conversations a bot or voice agent resolves from start to finish without handing off to a human agent.

A context window is the maximum amount of text, measured in tokens, that a language model can consider at once, including instructions, documents, conversation history and its own reply.

Conversational AI is technology that lets people interact with software in natural language, by text or voice, combining language understanding, dialogue management and connections to business systems.

Configure, price, quote

Configure, price, quote (CPQ) software helps sales teams assemble valid product configurations, apply pricing and discount rules, and produce accurate quotes quickly.

Customer satisfaction score

Customer satisfaction score (CSAT) measures how satisfied customers are with an interaction or product, usually from a one-question survey rated 1 to 5 and reported as the percent of positive responses.

Data residency is the requirement or choice to store and process data in a specific country or region, often to meet legal, contractual or customer rules.

Deflection rate is the share of support inquiries resolved through self-service, such as help articles or bots, so that no ticket reaches a human agent.

Document intelligence is the use of OCR, layout analysis and language models to read documents such as invoices, contracts and forms and turn them into structured, validated data that a system can act on.

Days payable outstanding

Days payable outstanding (DPO) is the average number of days a company takes to pay its suppliers, calculated as accounts payable divided by cost of goods sold, times days in the period.

Days sales outstanding

Days sales outstanding (DSO) is the average number of days a company takes to collect payment after a credit sale, calculated as receivables divided by credit sales, times days in the period.

E-invoicing is the exchange of invoices as structured electronic data, not PDFs or paper, so the buyer's system can process them automatically and, in many countries, tax authorities can see them.

Electronic data interchange

Electronic data interchange (EDI) is the computer-to-computer exchange of standardized business documents, such as purchase orders, invoices and shipping notices, between trading partners without manual re-keying.

Embeddings are lists of numbers that represent the meaning of text, images or other data, so similar items sit close together and can be found by similarity search.

AI evaluations

Evals are repeatable tests that score an AI system's outputs against known-good answers or criteria, so you can measure quality and catch regressions before changes ship.

An exception queue is a list of cases an automated process could not finish by itself, held for a person to review, fix or decide, with the reason and evidence attached.

Fine-tuning continues training an existing model on your own examples so it learns a style, format or task, instead of being re-instructed through the prompt on every call.

First contact resolution (FCR) is the percentage of customer issues fully resolved in the first interaction, with no follow-up or repeat contact needed.

General Data Protection Regulation

The General Data Protection Regulation (GDPR) is the European Union's law governing how the personal data of people in the EU is collected, used, stored and shared.

Generative AI is a class of machine learning models that create new content, such as text, images, code or audio, by learning patterns from large amounts of training data.

Goods receipt note

A goods receipt note (GRN) is a record created when ordered goods arrive, confirming what was received, in what quantity and condition, and used to match against the purchase order and invoice.

Human-in-the-loop means a person reviews, approves or corrects an AI system's output at defined points before it takes effect, rather than letting it act unchecked.

Hyperautomation is a strategy label for combining several technologies, such as RPA, process mining, AI and low-code tools, to automate as many business processes as possible.

Intelligent document processing

Intelligent document processing (IDP) combines OCR with machine learning and language models to classify documents, extract fields and validate them against business rules.

Intelligent automation combines automation tools such as RPA and workflow engines with AI capabilities such as document understanding and language models, so processes that need reading or judgment can be automated too.

An intelligent virtual agent (IVA) is software that uses AI to hold natural conversations with customers by chat or voice, work out what they want and complete service tasks such as lookups, bookings and routing.

Invoice coding assigns each invoice or invoice line to the right general ledger account, cost center, project or tax code so the expense is recorded correctly.

Integration platform as a service

An iPaaS (integration platform as a service) is a cloud service for connecting applications and moving data between them using prebuilt connectors and visual workflows.

ISO/IEC 27001

ISO/IEC 27001 is an international standard for an information security management system (ISMS), certified by accredited auditors, covering how an organization manages information security risk.

Interactive voice response

Interactive voice response (IVR) is a phone system that greets callers and routes them using menu choices or speech, often handling simple requests like balances without an agent.

Know your customer

Know your customer (KYC) is the set of checks a regulated business performs to identify and verify its customers, understand the relationship and assess money-laundering risk before and during it.

Lead scoring ranks leads by how likely they are to buy, using fit signals such as company size and role and behavior signals such as pricing-page visits and email replies.

Lease abstraction is the process of pulling the key terms out of a lease, such as parties, rent, term, options and notice dates, into a structured summary that can be searched and tracked.

Large language model

A large language model (LLM) is a neural network trained on huge amounts of text to predict and generate language, used for drafting, summarizing, extraction, classification and reasoning over text.

Model Context Protocol

Model Context Protocol (MCP) is an open standard for connecting AI applications to external data sources, tools and workflows through one common interface.

Month-end close is the recurring process of finishing a period's accounting: posting entries, reconciling accounts, booking accruals, reviewing variances and locking the books so reports can be issued.

A multi-agent system splits a job across several AI agents, each with its own role, tools and instructions, coordinated by code or by a lead agent.

A non-PO invoice is a supplier invoice for goods or services bought without a purchase order, so it cannot be matched automatically and needs its own coding and approval route.

Optical character recognition

Optical character recognition (OCR) converts images of text, such as scans and photos, into machine-readable characters, without understanding what the text means.

Order-to-cash (O2C) is the end-to-end process from receiving a customer order through fulfillment, invoicing, collection and cash application.

Peppol is an international network and set of standards for exchanging e-invoices and other business documents, where each party connects through any accredited service provider.

Personally identifiable information

Personally identifiable information (PII) is any data that can identify a specific person, alone or combined with other data, such as a name, email address, phone number or ID number.

Procure-to-pay (P2P) is the end-to-end buying process: requisition, approval, purchase order, receiving, invoice matching and payment.

Prompt injection is an attack where text in a model's input, such as an email or web page, carries instructions that override or redirect what the AI was told to do.

A purchase order (PO) is a document a buyer sends a supplier listing the items, quantities, prices and terms it agrees to pay for, creating a record to match invoices against.

Quote-to-cash (Q2C) is the process from building a customer quote through contract, order, billing, collection and revenue recognition, joining sales and finance.

Retrieval-augmented generation

Retrieval-augmented generation (RAG) fetches relevant passages from your own documents at question time and gives them to a language model, so answers draw on current, specific sources.

Reconciliation compares two sets of records that should agree, such as a bank statement and the cash ledger, then investigates and resolves any differences.

Request for information

A request for information (RFI) is a document a buyer sends to potential suppliers early in a purchase to learn what is available and who can supply it, without asking for a binding price.

Request for proposal

A request for proposal (RFP) is a document inviting vendors to propose how they would solve a stated problem, with approach, timeline and price, so a buyer can evaluate and choose among them.

Request for quotation

A request for quotation (RFQ) is a document a buyer sends to suppliers asking for a price on clearly specified goods or services, so quotes can be compared mainly on cost and terms.

Robotic process automation

Robotic process automation (RPA) uses software bots that mimic clicks and keystrokes in existing applications to perform repetitive, rule-based tasks.

Sales force automation (SFA) is software that automates a sales team's routine tasks, such as logging activities, tracking leads and opportunities, forecasting and generating quotes, usually as a core part of a CRM.

A small language model (SLM) is a language model with far fewer parameters than frontier LLMs, small enough to run on modest hardware or inside your own network.

SOC 2 is an independent auditor's report on a service company's controls, based on AICPA criteria covering security, availability, processing integrity, confidentiality and privacy.

Speech-to-text (STT), also called automatic speech recognition (ASR), converts spoken audio into written text.

Straight-through processing (STP) is when a transaction moves from start to finish with no manual touch. The STP rate is the share of items that complete that way.

Text-to-speech (TTS) turns written text into spoken audio, and is the voice a voice agent uses to speak its replies.

Three-way match checks that a supplier invoice agrees with both the purchase order and the goods receipt before payment, confirming that what was ordered, received and billed line up.

Tool calling lets a language model request that your software run a defined function, such as a database lookup or an API call, and then use the result in its next step.

Touchless invoice processing means an invoice is captured, validated, matched, coded and posted for payment with no manual handling. It is straight-through processing applied to invoices.

Two-way match compares a supplier invoice with the purchase order only, checking quantities and prices without verifying that the goods or services were received.

A vector database stores embeddings and quickly finds the nearest matches to a query vector, which is how semantic search and RAG systems retrieve relevant content.

A voice agent is an AI system that holds spoken conversations over phone or web, combining speech-to-text, a language model and text-to-speech to understand callers and reply in real time.

A webhook is an HTTP request that one system sends automatically to another when an event happens, such as a payment received, so the receiver reacts at once without polling.

Workflow automation uses software to run the steps of a business process, such as routing, data entry, checks and notifications, with little or no manual handoff between them.

Zakat, Tax and Customs Authority (Saudi Arabia)

ZATCA is Saudi Arabia's Zakat, Tax and Customs Authority. Its e-invoicing program, FATOORAH, requires taxpayers to issue structured electronic invoices through compliant systems.