Login Design Flow Question

I'm developing an app, let's call it the main app, that is built on another software, let's call it software A. This main app serves a company and its employees. Users have accounts within software A, which offers an API for user login and authentication.

Our current approach involves redirecting users from software A (after logging in and authentication) to the main app using their software A email. We then log them in our app using Supabase auth (this happens on the server level, users do not see this). I aim to avoid an extra login step since software A handles user authentication.

However, I'm seeking advice on the best way to verify users and manage their passwords on supabase. I've been manually creating their accounts with a single password and storing it in encrypted form on the server. I understand this isn't the optimal method, so I'm exploring better solutions. Additionally, the main app and the software A login authentication app are two separate apps.
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