By process (in the JSF specification it's called execute) you tell JSF to limit the processing to component that are specified every thing else is just ignored.
update indicates which element will be updated when the server respond back to you request.
@all : Every component is processed/rendered.
@this: The requesting component with the execute attribute is processed/rendered.
@form : The form that contains the requesting component is processed/rendered.
@parent: The parent that contains the requesting component is processed/rendered.
With Primefaces you can even use JQuery selectors, check out this blog: http://blog.primefaces.org/?p=1867