Article·AI & Engineering·Nov 6, 2024

How Do AI Agents Work?

By Brain John Aboze
PublishedNov 6, 2024
UpdatedNov 6, 2024

TL;DR

  • Learn how AI agents go beyond traditional automation by interacting continuously with their environments, making real-time decisions, and adapting based on feedback.

  • Explore the essential components that enable AI agents to function—like the planner, orchestrator, memory, and tools. Building advanced, multi-modal agents becomes straightforward with frameworks like LangGraph, CrewAI, AutoGen, and APIs like Deepgram’s, ensuring each component works harmoniously.

  • AI agents offer powerful advantages for businesses, such as increased efficiency, scalability, and improved customer service. However, challenges such as maintaining transparency and handling complex workflows must be addressed.

  • Building an effective AI agent requires thoughtful design and iteration, from defining goals to continuous monitoring. The Voice Agent API from Deepgram makes it easy for developers to quickly set up voice-enabled agents that can adapt to changing user and business needs.


Picture an AI assistant like J.A.R.V.I.S. from the Marvel universe's Iron Man supporting Tony Stark by not only accessing vast amounts of information but also understanding context, making decisions, and taking actions autonomously. 

While real-world AI agents aren't quite as advanced, they exhibit similar capabilities on a smaller scale. 

Today, AI agents power a wide range of industries—from healthcare and finance to customer service and autonomous driving—helping businesses automate millions of daily tasks and interactions. These agents don’t just retrieve data; they synthesize it, apply logic, and make decisions in real-time.

Here is what you’ll learn from this article:

  • The fundamental concepts behind AI agents and agentic systems.

  • The architecture of AI agents, including key components like the planner, orchestrator, tools, and memory.

  • How businesses can benefit from using AI agents, and the challenges they must address.

  • Practices and considerations when building and deploying AI agents in real-world scenarios.

Ready? Let’s jump right into it! 🚀

Understanding AI agents

At their core, AI agents are autonomous software entities capable of making decisions and performing tasks by perceiving, interpreting, and acting on their environment—often in real-time.

Unlike traditional software, which follows predefined programmatic logic, AI agents leverage AI models to adapt dynamically and respond to new situations. This allows agents to learn from outcomes and adjust future actions, moving beyond rigid control logic.

AI Agents vs. Single-Shot Inference Models

While Generative AI (GenAI) models like GPT-4o are excellent at producing outputs like text, images, or audio from given inputs, they often operate on single-shot inference—processing input and generating output without further interaction. 

In contrast, AI agents extend these capabilities by continuously interacting with their environment. They perceive changes, plan actions, execute them, and evaluate outcomes across multiple iterations. This makes agents more suitable for autonomous systems, such as chatbots, virtual assistants, or autonomous vehicles.

Types of AI Agents

AI agents come in various forms, each designed to address different levels of complexity and autonomy. Here are some common types:

  1. Simple Reflex Agents:

  2. Definition: These agents act purely based on current perceptions and predefined rules (or reflexes). They are ideal for simple, repetitive tasks that don’t require memory or context.

  3. Example: A thermostat that switches on or off based on the current temperature.

  4. Model-based Reflex Agents: 

  5. Definition: These agents maintain an internal model of the world, using both current data and historical information to make more informed decisions.

  6. Example: A stock-trading bot that considers both current market conditions and past trends.

  7. Goal-Based Agents:

  8. Definition: Goal-based agents are designed with specific objectives in mind. They evaluate different actions to determine the best course that aligns with their objectives efficiently.

  9. Example: A GPS navigation system that suggests the fastest route based on traffic data.

  10. Utility-Based Agents:

  11. Definition: These agents assess the value of different outcomes and select actions that maximize overall utility.

  12. Example: A delivery drone that chooses the most fuel-efficient route to minimize cost and maximize battery life.

  13. Learning Agents:

  14. Definition: Learning agents adapt over time, improving their performance based on experience. They learn from previous actions and adjust their future behaviors accordingly.

  15. Example: A chatbot that refines its responses based on user feedback and interactions.

For a deeper dive into these agent types, you can explore IBM’s article on "Types of AI Agents."

AI agents extend beyond simple automation by continuously interacting with their environment, making decisions, and learning from outcomes. Whether they are designed for straightforward tasks or complex problem-solving, these agents demonstrate the evolving potential of intelligent systems across industries. 

As the next section will explore, understanding the architecture and components of these agents is crucial to building efficient systems.

Core Components of AI Agents

AI agents are complex systems composed of multiple interconnected components. Each component enables the agent to perceive its environment, make decisions, take actions, and learn from outcomes. 

Understanding these components helps you appreciate how AI agents operate and adapt to real-world scenarios.

Perception Layer

The Perception Layer acts as the gateway through which the agent understands the world. It mirrors human senses by acquiring and interpreting inputs across multiple modalities (text, visuals, audio, etc.) to interpret its environment. For a Voice AI Agent, the perception layer processes spoken input and converts it into text using speech-to-text (STT) models.

The perception layer in a voice agent also identifies:

  • Intent: Recognizing what the user wants to achieve.

  • Entities: Extracting key information such as dates, locations, or product names.

  • Sentiment: Determining the tone or mood of the user.

Example:

When a customer says, “I want to change my delivery address,” the perception layer identifies the intent (change delivery address) and key entities (delivery address).

Other AI systems may extend perception with technologies like LiDAR for mapping or GPS for navigation.

Orchestrator Layer

The Orchestrator Layer manages the flow of information across the agent’s components, ensuring tasks are executed in the right sequence. Think of it as the central coordinator that directs data between perception, decision-making, and action layers to fulfill user requests. 

It routes inputs received from the perception layer to the decision-making layer, manages interactions with memory, and triggers appropriate actions.

Example: 

The orchestrator determines that the user’s intent is related to shipping. It directs the query to the delivery module, retrieves previous shipping addresses from memory, and prepares a response to confirm the change.

In multi-agent systems, the orchestrator manages collaboration among agents to ensure smooth service delivery.

Key Functions of the Orchestrator Layer:

  • Inter-layer Coordination: Ensures data flows between components.

  • Task Delegation: Assigns tasks based on the user’s intent.

  • Process Management: Oversees operations, ensuring steps are executed in sequence.

  • Multi-Agent Coordination: Manages synchronization between agents (e.g., voicebot interacting with a billing bot).

In a voice AI agent, for instance, the orchestrator:

  • Receives the interpreted query from the Perception Layer.

  • Routes it to the Decision-Making Layer for action planning.

  • Pulls relevant data from the Memory Layer (e.g., previous interactions or address information).

  • Coordinates with external APIs (e.g., location data) if required.

Decision-Making Layer

The Decision-Making Layer acts as the brain of the agent, combining reasoning, planning, and logic to make informed decisions. The agent relies on deductive, inductive, and abductive reasoning to tackle different challenges:

  • Deductive Reasoning: Drawing specific conclusions from general principles.

  • Example: For a voice AI agent - “If the account balance is overdue, notify the user of the payment status.”

  • Inductive Reasoning: Making generalizations from specific observations.

  • Example: Most users with failed payments ask for card details, so offer the option proactively.

  • Abductive Reasoning: Inferring the most likely explanation from limited information.

  • Example: Given the frustration detected, it’s likely a login issue. Offer password reset assistance.

The planning process involves:

  • Comprehensive planning: Breaking tasks into a full sequence of steps.

  • Adaptive planning: Adjusting plans based on new data.

  • Hierarchical planning: Operating at multiple levels of abstraction.

For example:

If the user asks for a refund, the agent may create an adaptive plan:

  1. Step 1: Verify recent transactions.

  2. Step 2: Present refund eligibility criteria.

  3. Step 3: Escalate to a human agent if policy exceptions are involved.

Plan reflection: If the refund request fails due to policy constraints, the agent learns from user feedback and improves future decision-making.

Action Layer

The Action Layer enables the AI agent to execute decisions, interacting with digital or physical environments through APIs, tools, or devices. It translates planned actions into real-world outputs, such as sending emails, generating reports, or operating IoT devices. Key functions include:

  • Executing planned actions: Converts decisions into actions.

  • Using APIs and tools: Leverages external resources.

  • Performing embodied actions: For physical agents, it engages with IoT or robotic systems.

For example:

  • The AI agent detects a shipping issue and creates a ticket in the logistics system.

  • It then sends a notification to the customer via email with tracking updates or the refund process.

  • The agent may also escalate the issue to a human agent if it detects urgency or complexity beyond its capability.

Memory Layer

The Memory Layer stores historical data to ensure the voice AI agent provides personalized and coherent responses. It can access short-term, long-term, entity, and contextual memory to maintain conversation continuity.

For example:

The voicebot retrieves the customer’s previous shipping addresses (long-term memory) and recognizes the current session’s inquiry (short-term memory). It recalls the user’s preferred shipping address (entity memory) and ensures the conversation flows naturally across multiple interactions (contextual memory).

Learning Layer

The Learning Layer allows AI agents to improve by analyzing user feedback and updating models. This layer interacts with the memory system to ensure that new knowledge from user inputs is incorporated into the agent’s behavior (adjusting decision-making processes and personalizing future interactions) so they get smarter over time.

For example:

If the voice AI agent misinterprets an intent, the customer might respond, “No, I want to return the product, not track it.” The agent logs this correction and improves its intent recognition for future interactions.

In this section, we explored the core components of AI agents, especially through the lens of a voice AI agent. Each layer works harmoniously from perception to action to deliver personalized, intelligent interactions. 

Whether it’s setting reminders or making weather predictions, these components enable voice agents to operate efficiently, adapt to user preferences, and learn from every interaction.

How to Build AI Agents

Building AI agents is a process that combines artificial intelligence, software development, and problem-solving skills. Whether you're a developer or part of an organization looking to integrate AI agents, understanding the foundational steps and selecting the right tools is key.

Here’s a five-step guide to developing AI agents:

Step 1: Define the Agent’s Goals and Scope

Before writing a line of code, it's important to clearly define the purpose and tasks of your AI agent. Consider the following:

  • What problem is the agent solving?

  • Who will use the agent, and what are their pain points?

  • Which tasks will the agent automate, and what are the success metrics?

For example, a voice AI agent for customer service might aim to reduce call handling times by assisting users with common requests, like password resets or billing inquiries.

Step 2: Select Tools and Frameworks

Choosing the right frameworks and tools depends on your agent’s goals, the modality (text, voice, or multimodal), and the platform you’ll be integrating. Key considerations include:

  • Scalability: Can the framework handle growing user demand?

  • Integration: Does it work well with your existing systems and APIs?

  • Modality: Does it support the required inputs, like voice, text, or images?

Here are some popular frameworks to get started:

  • Voice Interaction and Conversational AI:

    • Deepgram’s Voice Agent API: A voice-to-voice API for real-time conversation with customers. It enables voice AI agents to listen, think, and respond naturally, making it ideal for customer service agents.

  • Multi-Agent Orchestration and Collaboration:

    • CrewAI: A Python-based framework for coordinating multiple AI agents, enabling collaborative task execution.

    • LangGraph: An extension of LangChain that supports structured workflows between multiple LLM agents.

  • Experimental and Research-Driven Frameworks:

    • AutoGen: A conversational framework by Microsoft offering features like multi-agent collaboration and personalization.

    • OpenAI Swarm: An experimental platform for exploring multi-agent systems, designed for learning and experimentation rather than production.

  • Data Integration and Retrieval:

    • LlamaIndex: A flexible framework for integrating custom data sources with large language models, extending agentic capabilities within RAG workflows.

Step 3: Implement Memory and Planning Modules

For your AI agent to provide coherent, adaptive responses, it must retain memory across interactions and plan tasks effectively.

  • Memory modules: Store user preferences, past interactions, and contextual information for personalized experiences.

  • Planning modules: Break down tasks into manageable steps and adjust plans as new information is received.

For example, an AI agent might store user preferences, like delivery addresses or billing history, in a memory module to provide quick and accurate responses in future interactions. 

Meanwhile, the planning module ensures the agent can dynamically adjust its response if the user changes their request.

Step 4: Test and Deploy the Agent

Once the agent is built, testing it in a controlled environment is crucial. This ensures that the agent:

  • Performs tasks accurately.

  • Handles edge cases without failure.

  • Operates within acceptable performance limits (e.g., response time).

For example, test how a voice AI agent responds to variations in user speech (accents, noise) and whether it correctly escalates issues to a human agent when needed.

After testing, deploy the agent on the target platform (e.g., customer support channel, user devices), ensuring it integrates with APIs and back-end systems.

Step 5: Monitor and Refine the Agent

Post-deployment, continuous monitoring is essential for refining the agent's performance. Gather user feedback and monitor key performance metrics, like task completion rates or refusals, to identify areas for improvement. Regular updates ensure the agent stays aligned with evolving user needs.

Post-Deployment Checklist:

  • Monitor user feedback and adjust decision-making logic.

  • Conduct regular batch updates to incorporate new data.

  • Ensure memory and planning modules remain aligned with evolving user needs.

For instance, an AI agent might learn to improve its handling of shipping-related queries by analyzing customer feedback and updating its memory and decision-making logic after every interaction—batch learning.

Building AI agents requires a careful balance of goal setting, tool selection, memory integration, testing, and continuous monitoring. Frameworks like Deepgram, AutoGen, and Langraph simplify this process to create intelligent, collaborative, and adaptive agents. 

With thoughtful planning and iteration, AI agents can deliver impressive user experiences across various industries. Speaking of planning, let’s see some of the common design patterns for building AI agents in the next section.

Design Patterns for Building AI Agents

Implementing effective design patterns is crucial for building AI agents that are adaptive, efficient, and capable of handling complex tasks. Below are four key design patterns: Reflection, Tool Use, Planning, and Multi-Agent Collaboration.

Reflection Pattern

The Reflection Pattern allows agents to self-assess and improve their responses by iteratively refining their outputs. Instead of generating a final output in one step, the agent critiques its work, identifies potential flaws, and makes adjustments to improve outcomes. This pattern is ideal for tasks that require error correction and continuous learning.

A well-known example of the Reflection Pattern is the ReAct Framework ("Synergizing Reasoning and Acting in Language Models"). ReAct integrates reasoning, actions, and observations within a feedback loop, allowing the agent to evaluate its actions in real-time and adapt strategies accordingly.

Example Use Case:

  • An AI agent using the ReAct framework reflects on whether the solution it provided satisfied the user. If not, it adjusts its response to offer a more relevant suggestion.

Tool Use Pattern

The Tool Use Pattern equips agents to use external tools and APIs to perform tasks beyond their native capabilities. The agent can retrieve real-time information, execute code, or manipulate data by interacting with web services, databases, or functions (software libraries).

The key benefits of the tool use pattern are:

  • Extends the agent’s native abilities by integrating external services.

  • Automates routine tasks such as data retrieval and report generation.

  • Provides access to real-time information for dynamic interactions.

Example Use Case:

  • A voice AI agent accesses a weather API to provide up-to-date weather forecasts when users inquire about local conditions.

Planning Pattern

The Planning Pattern allows agents to autonomously devise sequences of actions to achieve complex goals. This pattern leverages techniques such as chain-of-thought prompting, where the agent breaks down a task into subtasks and completes them optimally.

There are three common planning approaches:

  1. Comprehensive Planning: Breaks the task into a complete sequence and executes it step-by-step.

  2. Adaptive Planning: Adjusts the plan dynamically based on new information or conditions.

Hierarchical Planning: Operates at multiple abstraction levels, addressing high-level goals and detailed actions.

Multi-Agent Pattern

The Multi-Agent Pattern involves multiple specialized agents collaborating to solve a problem more effectively than a single agent could. Each agent focuses on a specific part of the task, with a routing mechanism ensuring that tasks are directed to the appropriate agent.

The key benefits of the multi-agent pattern:

  • Enables parallel or sequential execution of tasks across multiple agents.

  • Enhances efficiency through specialization.

  • Facilitates complex problem-solving through collaboration.

Example Use Case:

In a customer support system, an AI agent handles initial inquiries. If the issue involves billing, the request is routed to a billing AI agent. If technical support is required, the agent escalates the issue to a technical support agent.

These design patterns—Reflection, Tool Use, Planning, and Multi-Agent Collaboration—form the foundation for building robust AI agents. Each pattern enables agents to learn, extend their capabilities, plan effectively, and collaborate seamlessly

By carefully integrating these patterns, developers can create agents that are not only intelligent but also adaptable to complex real-world challenges.

Conclusion: How Do AI Agents Work?

As we’ve explored throughout this article, AI agents are reshaping how we interact with technology and automate complex tasks. By integrating components such as perception, decision-making, orchestration, action, memory, and learning, AI agents go beyond traditional automation to deliver advanced, intelligent solutions across various industries.

While the concept of J.A.R.V.I.S. from Iron Man offers a glimpse of what’s possible, current AI agents operate within more focused, real-world constraints. Yet, their capabilities—autonomous decision-making, real-time adaptation, and continuous learning—are already revolutionizing industries like customer service, healthcare, finance, and more.

Whether you are a developer looking to develop new ideas or a business trying to improve how it runs, AI agents can help you boost efficiency and make interactions more meaningful. Exploring Deepgram’s Voice Agent API, which powers real-time, natural conversations between humans and agents, is a great way to get started.

“We believe that integrating AI voice agents from Deepgram will be one of the most impactful initiatives for our business operations over the next five years, driving unparalleled efficiency and elevating the quality of our service.”
– Doug Cook, CTO @ Jack in the Box

Key Takeaways:

  • Understanding AI Agents: AI agents function autonomously, perceiving, deciding, and acting in real time, akin to J.A.R.V.I.S. from Iron Man.

  • Core Components: Key layers—perception, orchestrator, decision-making, action, memory, and learning—form the foundation of AI agent architecture.

  • Building AI Agents: Developing AI agents requires clear goals, tool selection (e.g., Deepgram’s Voice Agent API), memory and planning modules, thorough testing, and ongoing improvement.

  • Design Patterns: Patterns like Reflection, Tool Use, Planning, and Multi-Agent Collaboration boost an agent’s adaptability and efficiency.

  • Real-World Applications: AI agents are transforming industries, automating tasks, and enhancing user interactions while navigating challenges in scalability, integration, and ethics.

Take the next step in your AI journey—request access to Deepgram’s Voice Agent API today and discover how intelligent agents can transform your applications and services.


Next Steps

FAQs

1. What is the difference between an AI agent and traditional automation software?

Unlike traditional software that follows preset rules, AI agents are designed to operate autonomously by perceiving, deciding, and acting based on real-time data. This allows AI agents to adapt to dynamic environments and handle complex tasks without human intervention.

2. How do AI agents learn and improve over time?

Through components like the learning layer, AI agents refine their responses and actions by analyzing user feedback and past interactions. This ability to "learn from experience" helps AI agents deliver more accurate and personalized responses in future tasks.

3. What industries benefit the most from AI agents?

AI agents are widely used in customer service, healthcare, finance, and logistics. They automate repetitive tasks, streamline operations, and provide quick, data-driven responses to users’ needs.

4. How can I build a custom AI agent for my business?

Building an AI agent requires defining specific goals, selecting appropriate frameworks, and creating core modules for perception, decision-making, and action. Testing and continuous monitoring are essential to optimize the agent's performance in real-world applications.

5. What are the main challenges in deploying AI agents?

Scalability, integration with existing systems, and ethical considerations are primary challenges when deploying AI agents. Businesses must ensure their AI agents can handle increased demand, work seamlessly with current technology, and meet data privacy standards.

Unlock language AI at scale with an API call.

Get conversational intelligence with transcription and understanding on the world's best speech AI platform.