The upgrade to Windows 11 does not occur automatically when you purchase M365 E3. The licenses allow the upgrade, but you still need to initiate the upgrade process manually or through Intune.
Steps:
Ensure all Windows 10 Pro devices are enrolled in Intune. Use AutoPilot or manual enrollment.
Go to Microsoft Endpoint Manager Admin Center > Devices > Windows > Feature Updates.
Create a Feature update deployment policy:
Specify the Feature update version.
Assign the policy to a group that contains the devices/users you want to upgrade.