Flannery broke into the Ireland side last season and made an immediate impact during the RBS 6 Nations before injury ruled him out of the autumn internationals.
But he was included in an expanded 24-man squad for Ireland's clash with Wales because Munster's Frankie Sheehan and Ulster's Rory Best both have calf injuries.
And former Lions hooker Wood believes the added competition could drive Flannery to top the heights he reached 12 months ago.
Wood explained: "Flannery is a very fine player and he had a fantastic season last year.
"He came out of nowhere and he was easily the best hooker in the Six Nations.
"I think he had an excellent start to his international career - he got injured and missed the autumn but he has got back in now.
"And I think it is lucky in a way. He will be factored in but it will now be harder for him now and he has to re-find that form."
Ireland head coach Eddie O'Sullivan named an extended squad to accommodate a third hooker and fourth lock.
Mick O'Driscoll, who missed the autumn internationals, returns to the squad as cover for the injured Malcolm O'Kelly.
"Malcolm's knee injury is still a concern for us and we have allowed some more time for it to respond further to treatment," said O'Sullivan.
"Both Rory and Frankie are carrying slight calf strains, so we have named three hookers to give us some back-up in that area."
Irish rugby is on a high after comprehensive victories over South Africa, Australia and the Pacific Islands during the autumn and they head into the Six Nations.
"Ireland are the favourites," said Wood. "Of course you get momentum from a campaign like Ireland had in the autumn. It gives you confidence.
"The game against Australia was a game of confidence. They know what they can do and they can carry it over."