Failed to connect, 1601

[UFFE]

When I try to install (or uninstall an earlier version of) an msi
package (that I've created with InstallShield) I get the following log
lines:

MSI Machine policy value 'DisableUserInstalls' is 0
MSI Failed to connect to server. Error: 0x80040154
MSI MainEngineThread is returning 1601

while on screen I get something like 'the MS Installer service can not
be found'.
The MSI documentation says this can happen when in Windows failsafe
mode, or if the installer is not correctly configured. I'm not in
failsafe mode, and I can not see anything to configure. What can I do?

Thanks for any help!