File permissions define who can read, write, and execute files such as scripts. When the installation instructions ask you to CHMOD a file, you are being asked to set file permissions. File permissions can by modified by most popular FTP clients or through the control panel's built-in file manager.
Some common permission levels for files are:
600 Makes a file inaccessible
644 Readable by everyone (e.g. HTML documents)
666 File can be read and modified
755 File can be read and executed by everyone
777 Writable and executable by everyone (use with caution)
Most CGI scripts need to be set to 755. Please refer to the script's documentation for proper installation instructions.