A rod reduction instrument for position a rod relative to a seat of a bone anchor in a spinal implant system is provided. The instrument includes three concentric cannulas with circumferentially aligned rod receiving portions formed therein. One cannula is movable with respect to another to lock and unlock the seat of a bone anchor to the rod reduction instrument. The rod to be reduced is positioned inside at least one of the rod receiving portion. One cannula is moved with respect to another to lock the seat of the bone anchor to the rod reduction instrument. Once locked to the bone anchor, the remaining cannula is moved to reduce the distance between the rod and the seat within at least one of the rod receiving portions. The distance between the rod and the seat is reduced until the rod is position inside the seat. A secondary instrument is inserted through a central bore of the rod reduction instrument to introduce a cap and lock the cap to the seat securing the rod to the bone anchor.