I keep reading Franchise Tag like the NFL system.. How would such a system work in NBA, where the draft picks beyond top 10 have very low value...

Here is one possibility

We can have different levels of the Franchise tag and the stringent level would be

Above Max level ; allow each team room to sign one player above the maximum limit allowed for that player...They cannot sign another such player till the time original players above max contract is done.  I know I am talking about adding salary.. but we have seen that NBA is a league where one player makes a huge difference and I think it is really unfair to see great players making same salary as good player...If the owners think that a player is worth that much money, he should be ready to fork over that money or be ready to lose him to someone else who thinks that way.

So a team can franchise tag a player with more than a maximum salary and only teams that do not have a similar player can bid for him... And further that team should fork up at least 3 first round picks without lottery protection... If the bidding team does not have a first round pick in any of the following three years, the original team could choose to take the first round pick from a different year or refuse to send him...And importantly the bidding team cannot go over the Soft cap to sign this player (though the original team can go over the soft cap to do this)

Max Level: Franchise tag a player with max allowed salary (penalty 2 first round picks) ... same rules apply  -teams that have first round picks, cap space can only bid...Original team can go over the soft cap amount to franchise tag a player with max salary.... Teams can go over the soft cap to offer extension or place tag for max of two players.

Below Max Level: original team can franchise tag a person with 80% or preset  percentage of max deal... Penalty - one first round pick or a second round pick and same rules apply - teams that have first round picks, cap space can only bid ...  Original team cannot go over the soft cap to franchise tag a player with less than max salary

I think this way, it makes it really difficult for players offered max salary to change teams... And to give options to players, have some restrictions on how many times a player can be franchise tagged. I have not thought of all the rules, but I believe without some restrictions franchise tag would not really work (especially if there is just one or two first round picks)