ResearchResearch paperLarge Language Models1 source · Oct 10, 2026

Iterate on an LLM, Serve on an SLM

At the same time, small language models (SLMs) also gain more capabilities but have largely been able to keep their cost stable, offering 5-40 times cheaper inference for the narrow, repetitive subtasks that agents decompose work into.

Key points

  • As frontier LLMs gain more capabilities, the cost to run them also goes up.
  • We propose doing both in sequence.
  • Then, once the behavior converges, distill the recorded production behavior (not synthetic imitations of it) into an SLM through supervised fine-tuning (SFT).
  • We show a proper use case of this method through a scheduling agent for home-care agencies that fans out a single yes/no safety decision per caregiver-shift pair on GPT-5.4-nano.

Sources (1)

  • [1]Iterate on an LLM, Serve on an SLM
    arXiv (AI, ML, NLP, CV, robotics, multi-agent) · Oct 10, 04:51 AM
    At the same time, small language models (SLMs) also gain more capabilities but have largely been able to keep their cost stable, offering 5-40 times cheaper inference for the narrow, repetitive subtasks that agents decompose work into.
    As frontier LLMs gain more capabilities, the cost to run them also goes up.

Extractive summary: sentences quoted from the sources.

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