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Even though the db2-level might be updated to the latest version 11.1.4.4, run the below set of commands.

Stop TSM server and issue the following commands as the instance owner.

db2 start 
db2 force application all
db2 terminate
ipclean

login as root user and run

/opt/tivoli/tsm/db2/instance/db2iupdt -d <instance name>

login as the instance owner ID and issue the command:

db2updv111 -d TSMDB1

This issue is supposedly fixed in version 8.1.9.0 and higher.

http://www.fixthat.be/blog/2014/8/30/tsm-manual-upgrade-to-71

Use the following method to terminate the upgrade.

1) From a command prompt, open a DB2 command line environment window:

 db2cmd

2) set DB2INSTANCE=<your-instance-name>

3) db2start

4) From the DB2 command line window, catalog the database:

 db2 catalog db TSMDB1

5) Try a connection

 db2 connect to tsmdb1 ( it should state that db is not upgraded)

6) Upgrade the db to be compatible with the new DB2 level.

 db2 upgrade db tsmdb1
 

Before starting the Upgrade, save the following output commands:

As instance user:

[tsmsrv1@tsm01 ~]$ db2set -all
[i] DB2_PMODEL_SETTINGS=MAX_BACKGROUND_SYSAPPS:500
[i] DB2_ALTERNATE_GROUP_LOOKUP=GETGROUPLIST
[i] DB2_SKIPINSERTED=ON
[i] DB2_OPTPROFILE=YES
[i] DB2_BCKP_PAGE_VERIFICATION=TRUE
[i] DB2_KEEPTABLELOCK=OFF
[i] DB2_EVALUNCOMMITTED=ON
[i] DB2_SKIPDELETED=ON
[i] DB2COMPOPT=NO_EORE_LP
[i] DB2MAXFSCRSEARCH=5
[i] DB2NOEXITLIST=ON
[i] DB2LIBPATH=/opt/tivoli/tsm/server/bin/dbbkapi
[i] DB2ENVLIST=LIBPATH
[i] DB2COMM=TCPIP
[i] DB2CODEPAGE=819
[i] DB2_PARALLEL_IO=*
[g] DB2SYSTEM=tsm01
[g] DB2INSTDEF=tsmsrv1
[tsmsrv1@tsm01 ~]$ db2 get dbm cfg

          Database Manager Configuration

     Node type = Enterprise Server Edition with local and remote clients

 Database manager configuration release level            = 0x1400

 CPU speed (millisec/instruction)             (CPUSPEED) = 1.298947e-07
 Communications bandwidth (MB/sec)      (COMM_BANDWIDTH) = 1.000000e+02

 Max number of concurrently active databases     (NUMDB) = 32
 Federated Database System Support           (FEDERATED) = NO
 Transaction processor monitor name        (TP_MON_NAME) = 

 Default charge-back account           (DFT_ACCOUNT_STR) = 

 Java Development Kit installation path       (JDK_PATH) = /tsmsrv1/sqllib/java/jdk64

 Diagnostic error capture level              (DIAGLEVEL) = 3
 Notify Level                              (NOTIFYLEVEL) = 3
 Diagnostic data directory path               (DIAGPATH) = /tsmsrv1/sqllib/db2dump/
 Current member resolved DIAGPATH                        = /tsmsrv1/sqllib/db2dump/
 Alternate diagnostic data directory path (ALT_DIAGPATH) = 
 Current member resolved ALT_DIAGPATH                    = 
 Size of rotating db2diag & notify logs (MB)  (DIAGSIZE) = 1024

 Default database monitor switches
   Buffer pool                         (DFT_MON_BUFPOOL) = ON
   Lock                                   (DFT_MON_LOCK) = OFF
   Sort                                   (DFT_MON_SORT) = OFF
   Statement                              (DFT_MON_STMT) = OFF
   Table                                 (DFT_MON_TABLE) = OFF
   Timestamp                         (DFT_MON_TIMESTAMP) = ON
   Unit of work                            (DFT_MON_UOW) = OFF
 Monitor health of instance and databases   (HEALTH_MON) = OFF

 SYSADM group name                        (SYSADM_GROUP) = TSMSRV  
 SYSCTRL group name                      (SYSCTRL_GROUP) = 
 SYSMAINT group name                    (SYSMAINT_GROUP) = 
 SYSMON group name                        (SYSMON_GROUP) = 

 Client Userid-Password Plugin          (CLNT_PW_PLUGIN) = 
 Client Kerberos Plugin                (CLNT_KRB_PLUGIN) = 
 Group Plugin                             (GROUP_PLUGIN) = 
 GSS Plugin for Local Authorization    (LOCAL_GSSPLUGIN) = 
 Server Plugin Mode                    (SRV_PLUGIN_MODE) = UNFENCED
 Server List of GSS Plugins      (SRVCON_GSSPLUGIN_LIST) = 
 Server Userid-Password Plugin        (SRVCON_PW_PLUGIN) = dsmdb2pw
 Server Connection Authentication          (SRVCON_AUTH) = NOT_SPECIFIED
 Cluster manager                                         = 

 Database manager authentication        (AUTHENTICATION) = SERVER
 Alternate authentication           (ALTERNATE_AUTH_ENC) = NOT_SPECIFIED
 Cataloging allowed without authority   (CATALOG_NOAUTH) = NO
 Trust all clients                      (TRUST_ALLCLNTS) = YES
 Trusted client authentication          (TRUST_CLNTAUTH) = CLIENT
 Bypass federated authentication            (FED_NOAUTH) = NO

 Default database path                       (DFTDBPATH) = /tsmsrv1

 Database monitor heap size (4KB)          (MON_HEAP_SZ) = AUTOMATIC(90)
 Java Virtual Machine heap size (4KB)     (JAVA_HEAP_SZ) = 2048
 Audit buffer size (4KB)                  (AUDIT_BUF_SZ) = 0
 Global instance memory (% or 4KB)     (INSTANCE_MEMORY) = 6588672
 Member instance memory (% or 4KB)                       = GLOBAL
 Agent stack size                       (AGENT_STACK_SZ) = 1024
 Sort heap threshold (4KB)                  (SHEAPTHRES) = 0

 Directory cache support                     (DIR_CACHE) = YES

 Application support layer heap size (4KB)   (ASLHEAPSZ) = 15
 Max requester I/O block size (bytes)         (RQRIOBLK) = 65535
 Workload impact by throttled utilities(UTIL_IMPACT_LIM) = 10

 Priority of agents                           (AGENTPRI) = SYSTEM
 Agent pool size                        (NUM_POOLAGENTS) = AUTOMATIC(100)
 Initial number of agents in pool       (NUM_INITAGENTS) = 0
 Max number of coordinating agents     (MAX_COORDAGENTS) = AUTOMATIC(200)
 Max number of client connections      (MAX_CONNECTIONS) = AUTOMATIC(MAX_COORDAGENTS)

 Keep fenced process                        (KEEPFENCED) = YES
 Number of pooled fenced processes         (FENCED_POOL) = AUTOMATIC(MAX_COORDAGENTS)
 Initial number of fenced processes     (NUM_INITFENCED) = 0

 Index re-creation time and redo index build  (INDEXREC) = RESTART

 Transaction manager database name         (TM_DATABASE) = 1ST_CONN
 Transaction resync interval (sec)     (RESYNC_INTERVAL) = 180

 SPM name                                     (SPM_NAME) = tsm01
 SPM log size                          (SPM_LOG_FILE_SZ) = 256
 SPM resync agent limit                 (SPM_MAX_RESYNC) = 20
 SPM log path                             (SPM_LOG_PATH) = 

 TCP/IP Service name                          (SVCENAME) = 51500
 Discovery mode                               (DISCOVER) = SEARCH
 Discover server instance                (DISCOVER_INST) = ENABLE

 SSL server keydb file                   (SSL_SVR_KEYDB) = 
 SSL server stash file                   (SSL_SVR_STASH) = 
 SSL server certificate label            (SSL_SVR_LABEL) = 
 SSL service name                         (SSL_SVCENAME) = 
 SSL cipher specs                      (SSL_CIPHERSPECS) = 
 SSL versions                             (SSL_VERSIONS) = 
 SSL client keydb file                  (SSL_CLNT_KEYDB) = 
 SSL client stash file                  (SSL_CLNT_STASH) = 

 Maximum query degree of parallelism   (MAX_QUERYDEGREE) = ANY
 Enable intra-partition parallelism     (INTRA_PARALLEL) = NO

 Maximum Asynchronous TQs per query    (FEDERATED_ASYNC) = 0

 Number of FCM buffers                 (FCM_NUM_BUFFERS) = AUTOMATIC(4096)
 FCM buffer size                       (FCM_BUFFER_SIZE) = 32768
 Number of FCM channels               (FCM_NUM_CHANNELS) = AUTOMATIC(2048)
 FCM parallelism                       (FCM_PARALLELISM) = AUTOMATIC(1)
 Node connection elapse time (sec)         (CONN_ELAPSE) = 10
 Max number of node connection retries (MAX_CONNRETRIES) = 5
 Max time difference between nodes (min) (MAX_TIME_DIFF) = 60

 db2start/db2stop timeout (min)        (START_STOP_TIME) = 10

 WLM dispatcher enabled                 (WLM_DISPATCHER) = NO
 WLM dispatcher concurrency            (WLM_DISP_CONCUR) = COMPUTED
 WLM dispatcher CPU shares enabled (WLM_DISP_CPU_SHARES) = NO
 WLM dispatcher min. utilization (%) (WLM_DISP_MIN_UTIL) = 5

 Communication buffer exit library list (COMM_EXIT_LIST) = 
 Current effective arch level         (CUR_EFF_ARCH_LVL) = V:11 R:1 M:0 F:0 I:0 SB:0
 Current effective code level         (CUR_EFF_CODE_LVL) = V:11 R:1 M:0 F:0 I:0 SB:0

 Keystore type                           (KEYSTORE_TYPE) = NONE
 Keystore location                   (KEYSTORE_LOCATION) = 

1. Issue the following command, to delete the instance:

/opt/tivoli/tsm/db2/instance/db2idrop InstanceName

2. Start the installation wizard again and step through it to upgrade the Tivoli Storage Manager server.

3. After the upgrade, recreate each of the instances using the following command:

/opt/tivoli/tsm/db2/instance/db2icrt -u InstanceUser InstanceName

4. Recreate the variables in the instance file using the db2set -i command. Issue this command for each variable in your instance file. Ensure that the variable is in quotation marks:

/opt/tivoli/tsm/db2/instance/db2set -i InstanceName "Variable"

For example, to recreate the first variable in the example instance file, issue the following command:

db2set -i tsminst1 "DB2_SKIPINSERTED=ON"
db2set -i tsminst1 "DB2CODEPAGE=819"

5. Stop and start the database instance. Connect as instance user ID, then issue the following commands:

a. Start DB2®:

db2start

b. Catalog and upgrade each database:

db2 catalog db TSMDB1
db2 upgrade db TSMDB1

If the DB path is not the same as instance PATH then use:

db2 catalog db TSMDB1 on /home/db2inst1

c. Stop DB2:

db2stop

6. Start and run the Tivoli Storage Manager server.