However, he has stopped short of guaranteeing the star winger a spot in next month's Rugby World Cup opener.
O'Connor was forced to watch Saturday's 25-20 victory over New Zealand from the sidelines after being handed a one-Test ban for his no-show at the official World Cup squad announcement.
Strong performances from utility Adam Ashley-Cooper and outside centre Anthony Fainga'a have left Deans with a major selection dilemma ahead of his side's opening Pool C fixture against Italy in Auckland on September 11.
O'Connor's goal kicking - Quade Cooper kicked four-from-six in his absence - could ultimately save him, but the 21-year-old faces a nervous wait ahead of next week's team announcement.
"For James he'll just go about his work, he'll train and prepare to best effect as will every squad member," said Deans.
"The fact of the matter is not every member will get the opportunity to pull on the jersey but every member will contribute to what we do ultimately.
"And that's the priority, we've just got to prepare and play well.
"We've now got genuine competition for spots and we've got a squad where we have genuine belief in every member, and that's a good place to be.
"It's good for the players and for us."
When asked how O'Connor coped with the most trying week of his 28-Test career, Deans said: "He's done a lot of work on behalf of the group in the background over the last week. We got him doing some tasks, helping staff, helping players, and it was good.
"He was serving the team in another way. And you only had to look ... I think it was when Radike (Samo) scored if you saw that clip, to see his response.
"He was genuinely excited for the team and as a member of the team that's an important quality."
Meanwhile, Deans concedes complacency is a real danger after the Wallabies reclaimed the Tri Nations trophy for the first time in 10 years on Saturday night.
"We're exactly where we want to be in so far as Tri Nations has concluded and we were successful in that," he said.
"But we realise that that's now irrelevant and if anything it has the potential to impact in a negative way to what we do next if we think that we can take any comfort out of it.
"That's now concluded and now we can really apply all our energy and focus on the World Cup and make sure that we enter that tournament, which is a distinct tournament, in the right frame of mind.
"We've had a great preparation to be honest, playing the All Blacks at Eden Park, playing the Springboks at Kings Park in Durban and then playing the last fixture at Suncorp Stadium was great preparation for us."
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