CHICAGO, DEC. 20 -- Indiana Pacers President Donnie Walsh sat in empty Market Square Arena Wednesday, watching rookie Kenny Williams get pregame tutelage from assistant Bob Hill. Walsh's team had performed reasonably well on a four-game western swing, beating Utah and coming close against the Los Angeles Lakers. Dick Versace seemed safe.

Until today. Less than 24 hours after the Pacers lost to the Washington Bullets, Versace was fired. The team is 9-16, with only one win in 12 road games.

Walsh said he decided to replace Versace with Hill after Wednesday's 114-112 overtime loss.

Hill was 20-46 with the New York Knicks after replacing Hubie Brown midway through the 1986-87 season. Terms of his contract with the Pacers were not disclosed.

"The reason for the change is, basically, we don't feel the team is going in the right direction," Walsh said. "We had some problems going back to last year. We felt these problems could be resolved but, based on the first month and a half of the season, they weren't getting resolved. We are a professional basketball team. We are here to win games, and when you're not doing that you have to make a change."

Walsh said he informed Versace and Hill of his decision Thursday morning. The team learned of the change during a private meeting after the news conference.

The players met with Walsh before the firing. They said they were the problem, not Versace. And they wanted a chance to get to the playoffs again under him.

"I don't think it's just Dick," Walsh said on Wednesday. "We have to focus on what you're all here for, and that's to win games. Wherever the problems arise that's going to hinder you from doing that, you've got to get that out in the open and talk about it. A lot of teams go through that. It's not unique to our team."

Versace had promised Walsh he would have the Pacers at .500 by the end of January. Walsh went west with them and was satisfied.

"In my position, I think I've been involved as much as I'm going to be involved," Walsh said. "Now it's just a matter of sitting back, looking at our team and making our evaluattions based on what I look at on the floor."

The Pacers are last in the Central Division. Versace was 73-87 over three seasons. Little Action for Jackson

Denver's Chris Jackson, the third pick in June's draft, scored a career-high 27 points Wednesday, the first time in weeks he had seen extended floor time.

"The playing time is not much," he said last week. "That's the part that's a bigger adjustment than anything. The physical part is adjusting, but it's hard when you're sitting on the bench and you have to come in cold."

Jackson needs the ball. But in Denver's system Michael Adams brings the ball up court every time, and the team doesn't set many picks.

Jackson is left wondering why the Nuggets took him. John Thompson, courted by the Nuggets before deciding to stay at Georgetown, was a big Jackson fan. However, Jackson hasn't been used much by Coach Paul Westhead.

"But that's life. You have to keep working hard," Jackson said. "It's frustrating. I don't worry about that. I try to go out every night and play my game. Hopefully one day the opportunity will come." . . .

Atlanta General Manager Pete Babcock acknowledges he had a scout looking at Seattle's Dale Ellis last week. No Butts About It

The Bulls may be looking at changes specifically with Detroit in mind following their pounding by the Pistons in Auburn Hills, Mich.

"We'll see how we come back on Christmas Day {when they play the Pistons again} and what kind of game we can produce," said Coach Phil Jackson. "And then if we can't produce a game against this club, we'll have to think about what we're doing with our personnel and what we're doing with our team."

Said Michael Jordan: "It was a royal butt-kicking." . . . Not Pretty, but Good

Houston, until last night chugging along at 13-11 and third in the Midwest Division, is only two games better than last season's pace. But the team's makeup looks improved.

Kenny Smith came from Atlanta. And while no one's making him out to be a premier point guard, he's filled the Rockets' needs adequately, despite still having a pain-inducing jump shot.

"I thought it was one of the ugliest looking shots you'd ever want to see," Houston Coach Don Chaney said. "I told our guys the first time he showed up, 'The first thing we've got to do is work on his shot.' But it kept going in. So if it's not broke, don't fix it."

Smith's presence allows Chaney to use Sleepy Floyd as a reserve for instant offense. And Houston has gotten a lift from free agent Kennard Winchester, of Division III Averitt College by way of James Madison University.

"He played in Europe last year and he had experience," Chaney said. "He's getting {first-round pick} Dave Jamerson's time. Kennard is a much stronger player right now." . . .

Before giving the title to Portland, note that the Trail Blazers have played the fewest road games (nine) of anyone in the league and have yet to come to the East Coast. In addition, they have a six-game eastern and Texas swing at the beginning of April. "That's going to hurt them," one coach said.