What does the saying each dog barks in his own yard mean?

The saying 'each dog barks in his own yard' means that every organism is brave at his/her place or criteria. Outside the normal circumstances of that organism, the organism will not be able to perform.

For example, a person might take up a fight with another person when he has his group of friends around him. But he won't take up a fight if his friends are not present with him.