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I have successfully built and tested a tool in my local alteryx designer instance where I can use a directory tool + dynamic input tool to use SharePoint 365 .xlsx files saved to a particular folder as inputs to a flow. It works perfectly locally, even without mapping to a locally synced SharePoint folder (i.e., connecting to \\\\xxx.sharepoint.com\sites\msteams_facxxx\Shared Documents\General\SHARE Folder\ ... etc from the directory input). The file path appears valid locally and the flow completes successfully. As soon as I attempt to run in the HUB, however, I get the following error:
Invalid Directory : The network path was not found. (53)
I have attempted to run the flow using both the service account as well as a run-as identity with my own network credentials. Of note- we do not have SSO configured on the HUB.
The error message looks like the server running Analytics Hub is not able to access the folder specified in the Directory tool configuration based on the credentials being used to run the workflow. If you have log-in access to the machine, you could try to access that path through the File Explorer to ensure the network configurations are allowing a connection. It may require specifying a domain with your user credential depending how your network is setup. I don't think having SSO setup on Hub will impact this either way.
You might want to try reaching out to Support, as well, if you haven't yet.