I had this issue with my dog. He is doing great now at 2. Low threshold for defense sounds about right for our case. He has suspicion and is a forward defensive dog.
I can only tell you what worked for us under the guidance of a K9 trainer who had worked with his sire. I am a novice but he has taught me a lot.
1) joined an IPO club, learned more structured obedience that is based on focus on handler. The focus part was key. I thought the focused heel was silly until I learned the value of being able to get your dog's undivided attention on demand. It doesn't mean he has to walk around in life like that, it means when I say fuss it means look at me and only me. Also at IPO he learned confidence through the protection work. Being that defensive is steeped in uncertainty and lack of confidence in a lot of cases..it was in our case.
2) Once I felt he knew the focus command it was serious correction time when he ignored it and lunged, barked, or even eye balled somebody in a specific way. There is a more graphic term for the "eye balling" but cant type it here lol Prong corrections, and being 4'11 I had to correct like I meant it. You don't make those decisions, I do. And it has to be delivered with timing. Once they are in full reactivity ill/late timed corrections don't always work and can also make it worse. Definitely have a breed knowledgeable trainer work this with you. It is a worthy investment.
3) Continue with training and safe exposure. It isnt train and it's fixed. It's a matter of implementing what you have learned all the time. When we go to Lowes we do OB there. He is constantly rewarded for being neutral in one way or another (verbal praise, a tug or ball reward..I change it up)
Through all that and probably through maturity and his genetic temperament coming into full view, he is actually friendly. He like meeting people that are appropriate. he sits and is released to greet. He enjoys that. Who knew? His "curious" face puts some people on edge so I have to watch for mixed signals too. I can tell when he is curious and anticipating saying hi, or when he is dead staring. It is not easy, it was my obligation to learn all that body language and to pay a trainer to teach me.
However I will always have to have my head on a swivel for the idiots that will ruffle and get all over a strange dog without asking. He will never be ok with that. He has good bite inhibition but he will scare somebody off by loudly letting them know not to do that to us. It is 100% my responsibility to pay attention at all times to what we are doing and who is around us so he is not put in that position period. It isnt fair to anyone, least of Valor..it undoes a lot of confidence building work. So I have developed a very firm "stop, do not pet him" without sounding alarmed which isn't great either. It's a command, not a distress plea if you know what I mean. So what if people are insulted? You have to protect your dog.
He is a good GSD. I feel safe with him by my side and in my house. It is my job in life to him to make sure he is safe too