Wasps have won just two of their six league matches this season, but Young has claimed that they have yet to reach their potential.
"London Welsh have surprised a lot of people in the last few months but they haven't surprised me at all. I always felt with someone like Lyn Jones there that they would be very competitive," he said at the club's press conference.
"He is the kind of coach that thrives leading a team with an underdog status and he knows how to get the best of players in that situation. We know that if we play to our potential we are a hard team to beat at home but we need to do that otherwise we will be punished.
Young also admitted his delight at being named as Barbarians coach for next summer.
"I was very pleased to be asked to do it again and it will be something special in the summer but I want to be clear that my only focus between now and then is London Wasps," he added.
"With the Barbarians I'll only really have around three meetings before the tour itself with the committee and so on so it's not something that will take me away from my day job. It will be special to play the Lions in Hong Kong and to face England again but it's a long way off."
Wasps currently occupy eighth spot in the Aviva Premiership.