There are two main AI contextualising methods for adding additional knowledge to a prompt. These are Retrieval Augmented Generation and Long context prompting.

Retrieval Augmented GenerationLong context prompting
ProsPre-processed, read onceSimpler infrastructure
Gives model less noiseUser provides all relevant context
Filters large amounts of content too big for models
ConsComplex preparation and search infrastructureRe-reading tax (reads all context even if not needed)
Silent failure (semantic model provides limited information)Needle in a haystack (model gets lost in detail)
Whole book problem (gaps between chunks provided by semantic model lookup)

Long context prompting is suited to smaller datasets or few documents.

Retrieval Augmented Generation is suited to large datasets such as found in a business.

Source: Is RAG Still Needed? Choosing the Best Approach for LLMs - YouTube