[Configuration Database] TF255374: The following SQL Server instance is not compatible with Team Foundation Server: VBXW2008\SQLSVR08. The default collation is set to Latin1_General_CI_AI. Team Foundation Server requires that the default collation be case insensitive and accent sensitive. You must choose a SQL Server instance whose default collation settings match these requirements
The best option i found out was either i re-install the SQL SERVER 2008 again fresh or create a new instance with collation settings defined properly at the time of installation .
7954d9b4-ba20-44e4-9f5c-d61e5fb24c34|0|.0|96d5b379-7e1d-4dac-a6ba-1e50db561b04
Team Foundation Server 2010
TFS 2010, TF255374