Apple releases new features, bug fixes, and security content through Software Updates. iOS and iPadOS devices handle these updates differently than Macs do, including the requirements for automating said updates.
In order for your support-enrolled iOS & iPadOS devices to be eligible for automated software updates, they must be supervised. Supervised devices are those connected to your organization's Apple Business/School Manager account, usually purchased through Apple eCommerce directly. This high level of trust between Apple, your organization, and the device, is required for software update management.
Your unsupervised device users should update their iPads and iPhones as soon as convenient - updates (16.4 to 16.4.1) are important for device security and stability. Upgrades (16.4.1 to 17.0) tend to be major feature releases and you should take a few minutes to make sure any business-critical iOS apps are compatible with the new release before upgrading. Apple has some brief notes about manually running updates here.
When a new software update is released for your eligible devices, they'll attempt to silently install it should the screen be locked. If the device is in use, the user will receive a notification:
Users can either tap Install Now to apply the update, Later to defer the update or Details to learn more. Updates can be deferred up to three times (generally, this means three days) before the user will be prompted to run it immediately or schedule it for overnight installation (the update window defaults to 2:00 AM local time). If you've queued the update to run overnight, please make sure your device is plugged into power - the update will not run should your battery level be too low.
If you'd like to enable this for your organization or have questions about supervising your unsupervised devices, please reach out to your account manager.