Permissions for SCCM Service Account
Solution 1:
My knowledge on the particulars of SCCM 2012 are somewhat limited. But installing software updates on Windows is pretty straightforward. You need an account with local administrator or SYSTEM level permissions to affect system-wide changes like a software update. So yes, at the very least your service account should be added to the local administrators group on each client device. How you accomplish that is kind of up to you, but the easiest probably is group policy.