Hiruzen was too easily on most subject, like to avoid warfare as much as possible.
nothing is perfect, i guess he did let thing go too much out of hand, despite this wisdom he could of done some much but didn't an use other methods to deal with the problem at hand by negotiation. if he use this power, he would be able to bend anyone to this will.
in the end he was too soft despite this god of shinobi status...