Issue with creating HFM application version 11.1.2.4.102

Gurus,

I have recently installed EPM 11.1.2.4 and applied 11.1.2.4.102 patch for HFM.

My environment, EPM 11.1.2.4:

Server 1: Foundation, EPMA, Calc

Server 2: HFM

Server 3: Reporting, FR

Database: SQL server 2008 R2

Now when I try to create HFM application in workspace I get the following message and I cannot open the application at all.

I did check the logs and found out the following information

xfm-odl-<appname>.log


[2016-01-21T10:07:50.304129-7] [XFM] [ERROR:1] [EPMHFM-07392] [XFM] [ecid: XDS.0000.0000.0000.0001] [File: XfmODBC.cpp] [Line: 193] [userId: ] [appName: HFMTEST] [pid: 2204] [tid: 2520] [host: xxxx] [nwaddr: xxxx:0;] [errorCode: 800402B5] [srcException: NotSpec] [errType: 1] [dbUpdate: 1] [11.1.2.4.102.5088] An unknown error occurred in an ODBC object. [[1 record: SQLSTATE = IM002; NATIVE ERROR = 0; MSG = [Microsoft][ODBC Driver Manager] Data source name not found and no default driver specified]] 
[2016-01-21T10:07:50.397732-7] [XFM] [ERROR:1] [EPMHFM-07407] [XFM] [ecid: XDS.0000.0000.0000.0001] [File: XfmODBC.cpp] [Line: 541] [userId: ] [appName: