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The initial installation of Lion Server’s Software Update service is one of the easier services to set up and manage. Begin by opening Server Admin and clicking on the name of the server you wish to install the Software Update service from the SERVERS list. Then click on the Settings button in the toolbar and click on the Services tab. Here, check the box for Software Update and click on the Save button.
Once the Service is listed under the name of the server in the SERVERS sidebar, click on Software Update there. No options need to be enabled in order for the Lion to be able to cache updates. However, given that it doesn’t automatically cache any of the updates, some of these options on this screen can be useful. These include: