From RTC client "Help Content", search for "Defining types of work items". The following instructions are displayed and it seems that there is a GUI interface allowing defining work item types (instead of directly updating xml files). In step 2, it says "Click the Process Configuration tab". However, I was not able to find this tab. Any idea? Thanks.

The following was copied from Help Contents.
1. In the Team Artifacts view of the Work Items perspective, right-click the project area and select Open.
2. Click the Process Configuration tab. Expand Project Configuration and then Configuration Data. A work item type belongs to a type category. The predefined work item types (Defect, Enhancement, and Task) belong to the com.ibm.team.workitem.workItemType category. Select the type category that the new work item type belongs to, or click Add Category to create a category. In the Work Item Types section, click Add. Enter a name for the new type. By default, the ID field is populated with the same value that you enter into the Name field, but it is in lowercase. You can edit the ID field value. Click Add Icons, and navigate to a graphics file to use as the icon for the new work item type.
3. Click Save to save your changes.
The process specification XML code is updated to reflect the changes that you make in the editor.