starting svrmgrl caused immediately an Oracle error

I installed Oracle 8i on my RH61 Linux box. I am preparing to create the first instance that I call TST3. The password file orapwtst3 and inittst3.ora file have been created on $ORACLE_HOME/dbs. The ORACLE_SID variable was set up and exported. Yet when I start server manger to create the instance, several odd things occured:

[oracle8i_at_feb2000 create]$ echo $ORACLE_SID
tst3
[oracle8i_at_feb2000 create]$ svrmgrl

Oracle Server Manager Release 3.1.5.0.0 - Production

(c) Copyright 1997, Oracle Corporation. All Rights Reserved.

ORA-12545: Connect failed because target host or object does not exist SVRMGR> connect internal
Password:
ORA-12545: Connect failed because target host or object does not exist SVRMGR> exit
Server Manager complete.

First, he ORA-12545 suggest some kind of network error, but in this I dont have any instance set up yet so I did not bother to set up the network config files properly. Is svrmgrl seriously trying to connect to TST3 when no connect string has been passed yet? On NT (with Oracle 8.0.4 though), I do not experience this problem.

Second, in all the 8i installation guides I saw, the command "connect internal" is supposed to connect without any password so that one can create the database. Not so on my box. I will get the error message regardless if I entered the password correctly (the message doesnot suggest a wrong password anyway).

Do the experts have any idea what could be wrong? Could it some Oracle server processes need to be started first? Or the svrmgrl binary I got is crap?

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