Worst decision was giving Virgil Sollazzo a meeting just to say "no" to Sollazzo's proposal. This was a poor strategic move for the Corleone family and an incredible personal embarassment for Sollazzo.
The entire plot of the movie is based on this premise, which is a genuinely realistic business strategy.
Don Corleone should take that meeting only to accept the proposal, not to decline it. As Don Barzini says, "A refusal is not the act of a friend." A good consigliere would have recognized the threat posed by Sollazzo and his drug business and understood the implicit meaning of granting the appointment. I think a cunning Sicilian consigliere like Don Genco would have understood the threat Sollozzo and his drug trade posed and somehow would have dealt with it long before a sit-down with Don Corleone would have been considered. That's why Sollazzo says, "Could I have gotten to him ten years ago?" The answer to that question is an emphatic "NO."
Tom Hagen didn't understand that and Vito allowed himself to be convinced to "give Virgil Sollazzo a day next week." While you might argue that it's all Tom's fault, ultimately Vito understood that the drug trade was available to him, and had been for quite a while, and he wanted no part of it for very good reason, but didn't make his position clear to his top people. Consequently, one bad decision leads to another when Tom grants the appointment and Vito says no.
For the record, Vito should not have said yes just to avoid conflict. TOM should have said no and alerted Vito to the threat. That's within the scope of Tom's job as consigliere.
tony b.