you still do everything else normal, but the #2 and #5 pick go to a playoff team (each of those teams has a 1 in 8 chance of getting one of those premium picks). The rest of the lottery selections and the rest of the pick slots are delegated as they currently are.
it just takes some of the incentive away to not be playoff team, and teams would be less worried about being "stuck in the middle" cuz making the playoffs as a 5-8 seed doesn't mean you can't still get a draft pick to improve your team.
It also means the middle teams actually want to make the playoffs your odds of getting a good pick are better as a last team in the playoffs instead the team the just missed the playoffs.