RAG vs Fine-Tuning: A Practical Case Study

In this blog, we dive deeper into the practical application of RAG (Retrieval-Augmented Generation) and fine-tuning by exploring real-world scenarios. If you’re deciding between these approaches for your AI solutions, this breakdown will clarify which to use based on specific system requirements.

We’ll analyze three examples:

  1. AI Financial Planning Assistant
    • Needs dynamic, real-time data handling, conversational fluency, and financial knowledge.
    • Verdict: RAG is the best choice, as it leverages real-time data and pre-trained conversational models effectively.
  2. Financial Information Extraction Bot
    • Focuses on extracting and structuring financial domain knowledge, with no need for conversational ability or dynamic data.
    • Verdict: Fine-tuning is ideal for tailoring the AI to this specialized task.
  3. AI Sales Bot
    • Combines dynamic product data and specialized sales techniques.
    • Verdict: A hybrid approach is optimal, using RAG for dynamic product knowledge and fine-tuning for sales strategies and tone.

For detailed information, please watch our YouTube video: RAG vs Fine-Tuning: A Practical Case Study

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