Your condition is likely where it's failing. You need to compare cb_usertype to the values actually in that field. The tutorial you linked was for when field conditions weren't available in the dropdown (so you couldn't select cb_usertype) for example. Example as follows.

Field: cb_usertype
Operator: Equal To
Value: student

With the above it expects cb_usertype has a value of student. This should match the value in cb_usertype exactly. So if cb_usertype is a select field you'd have the below option for example.

Option 1
Value: student
Label: Student

should i put a [ ] like [student] in the value and label boxes?

You don't need to put brackets in the values. For student just have it be "student" (without quotes). Your issue is the conditions. You're conditioning multiple times the same field. You currently have the below configured

cb_usertype Equal To [Students]
AND
cb_usertype Equal To [Parents]
AND
cb_usertype Equal To [Tutors]
OR
cb_usertype Equal To [Coaches / Instructors]

That doesn't make any sense. You can't have an AND condition against a field that can only have 1 value. You are trying to put all of this in a single auto action. You can't do that. You need to have 1 auto action per usergroup assignment. So you'd have the below.

Auto Action 1
Global
Triggers: onAfterUserRegistration, onAfterNewUser, onAfterUserUpdate, onAfterUpdateUser (covers frontend/backend registration/edit)
Type : Usergroup
User: Automatic
Access: All Non-Moderators (we don't want moderators accidentally losing their usergroups)
Conditions
cb_usertype Equal To [Students]
Action
Mode: Replace Usergroups
Groups: Registered, Students

Auto Action 2
Global
Triggers: onAfterUserRegistration, onAfterNewUser, onAfterUserUpdate, onAfterUpdateUser
Type : Usergroup
User: Automatic
Access: All Non-Moderators
Conditions
cb_usertype Equal To [Parents]
Action
Mode: Replace Usergroups
Groups: Registered, Parents

etc...

It failed because the user you're editing is a moderator. It's specifically configured so it doesn't alter moderators usergroups. Test with a regular registered user.