There is a fundamental difference between a Chatbot and an Agent. Chatbots react to your text with text. AI Agents pursue goals, interact with external environments, and execute complex workflows over time.
An AI Agent incorporates three core components that basic LLMs lack:
Agentic design often borrows from military strategy: the Observe, Orient, Decide, Act (OODA) loop. An agent observes its environment (e.g., API response), orients itself (reasoning), decides on a tool to call, and acts (executing the tool).