Hi Kannan,
Above watch was set to check the Current Doc Count .Means the number of documents that are currently being processed by the server.
The watch will alert you once the current doc count reaches 5 and 10 with the alerts for the particular server.
By default this watch was set for 5 and 10. you can change this values in the monitoring.
go to monitoring--> go the particular watch--> Click on Edit--> change the Danger , caution values to higher values.
This will not be an issue.
if you have more no of Documents which will be handled by CRYSTAL REPORTS 2011 REPORT APPLICATION SERVER, then increase the servcies by cloning them or do the proper sizing.
Regards,
JRK