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Three-quarters of the milestones established six months ago by the Defense agency charged with transforming departmentwide business processes have been achieved, according to an annual congressionally mandated report released Wednesday.

Of the 89 departmentwide milestones, 67 were met, according to the report, including all nine established specifically for the Business Transformation Agency and all 10 in the area of managing the department's property.

BTA's Annual Report to Congress described progress on the Pentagon's $4.2 billion effort to modernize and improve business operations, and also provided an updated transition plan and architecture.

Of the 48 milestones set by the agency for the military service branches and three Defense components - - the Defense Logistics Agency, Defense Finance and Accounting Service and U.S. Transportation Command -- 14 were missed, according to the report, which covers goals established in September 2005.

Thomas Modly, Defense deputy undersecretary for financial management and co-director of the BTA, said missed goals in the first year were to be expected and that the agency is trying to build a culture where improvements in business processes are made every six months.

The agency has recovery plans for getting the missed milestones back on track by the end of the fiscal 2006, and will continue to address the milestones that are laid out as far as 2013, Modly said.

Paul Brinkley, Defense deputy undersecretary for business transformation and Modly's co-director at BTA, said the agency looks forward to the next report, which is due to Congress in six months.

"I don't know if I'd say we're pleased," Brinkley said. "We're trying to shift the mindset from the big bang deliverable to six-month continual improvements."

Another version of the agency's transition plan is due Sept. 30, and will include the goals for fiscal 2007, Brinkley said.

Modly and Brinkley are serving as temporary BTA directors; a review of potential candidates to permanently hold the position, including people from inside and outside the Defense Department, is under way, Modly said.

"This candidate will have to be acceptable to a broad senior-level population at DOD," Modly said.

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