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2) Profit-driven .Only operating business of drug distribution, Cardinal Health could not make more profits. What Walter should do was to look for ways to enter more fields that are different. Since it was, an intermediary linked drug companies and hospitals closely and had two directions for deeper development. Product-related diversification was the method that could strengthen company itself and capture more markets.

Internal Reasons:
1) Cardinal Health had plenty resources for business use. Until 1995, Cardinal Health was a single-business with a drug distribution. It had very close connections with drug companies and hospitals. As an intermediary, Cardinal Health had the qualification for business extending and the definite development direction.
2) The company itself had the diversification capability. The company transformed the food distribution into both food and drug distribution, and then it sold off the food wholesale business and focused on the drug distribution. Cardinal Health had experienced many business activities, and it has become the leader of the market. Therefore, that was the time for the company to do something.
3.1.2Enforcement Mode
Acquisitions: Acquisition can increase the company’s strength and it is an operation mode.
Localization Acquisitions:
In 1971, when it was established, that was an acquisition deal. In 1980, with the demands of the market, its very first acquisition object was Bailey Drug. Except Pharmaceutical Distribution and Provider Division, other three divisions were set up based on these acquiring companies. These localization acquisitions had made Cardinal Health become the biggest player in the US health industry.

International Acquisitions:
Intercare (2003): Intercare was a leading British company in Europe. Its business was covering global market. The acquisition between Cardinal Health and Intercare, on one hand, Intercare could share the existed customers of Cardinal Health. On the other hand, Cardinal Health learnt a lot of unable to be imitated resources from Intercare.

ALARIS (2004): ALARIS was a famous global company. The products of the company are very famous in the health care field. In medication accidents, most errors were intravenous errors. Since among fatal medication errors, intravenous errors are very serious and account for a high percent. Therefore, the acquisition between the two companies had significant impact on reducing such errors and contributed to the health care industry.
The international acquisitions gave Cardinal Health more chances to enter other markets and improve its competitive capability.
3.2Successful Reasons:
1) It selected only leading companies of the market to acquire. These actions brought about economic value-added and the underperforming businesses transformed.
2) Look for the possibilities both in strategy and in organization. It could enhance the cooperation efficiency.
3) Cardinal Health was good at talent management, even though it had acquired the company, Cardinal Health also would hold talents of the acquired firms. It reflected intelligence of the leadership.
4) Cardinal Health owned a very professional team, which participate in the company’s activities related to various aspects of acquisitions. 

4. Opportunities and Challenges
4.1Opportunities
Larger Markets
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