This study investigates the relationships among enhancing adaptability leadership, innovation competences, and operational effectiveness within the Australian public sector. Specifically, the study hypothesises that the innovation competences of trust and power play a key role in the relationship between enhancing adaptability leadership and operational effectiveness. This study also adds to previous research examining some pathways through which enhancing adaptability leadership and innovation competences influence operational outcomes at the organisational level. Using a sample of 133 employees from two large public Australian universities, our research findings indicate that leadership which enhances the adaptability of employees was significantly and positively related to innovation competences of trust and power. Furthermore, enhancing adaptability leadership was significantly and positively related to organisational operational effectiveness in the public sector.