To understand what encoder resolution is, it’s good to have a better understanding of encoder feedback. Encoder feedback is important to the performance of different automation applications. When it is appropriately specified, an encoder will give you the results that you need to support positioning that is effective. If it is not properly specified, it can degrade the performance of the system.
Encoder resolution is the number of angular increments or what is called the measuring steps in one revolution (mechanical rotations) of the encoder shaft. This resolution is measured most commonly in pulses per revolution or PPR. PPR is used for incremental encoders and digital words are used for absolute encoders. Each encoder pulse represents the smallest angular step the encoder can measure. To put it simply, it is the granularity with which the encoder monitors the shaft rotation. Rotary encoders are available in different resolutions and usually, high-resolution rotary encoders can improve the accuracy of the system as a whole.
Some applications require particularly High-Resolution Rotary Encoder and it’s important they should work even in difficult physical environments. An example of a high-resolution rotary encoders are DS series and VL series of Netzer electric encoders. They have a lot of advantages aside from being a low profile. One of the best features is that they have high resolution and high precision. These encoders are forgiving to mounting tolerances and do not have ball bearings, flexible couplers, glass disc, detectors, and light sources so it is pretty much failure-free. Not to mention, they have very low power consumption.
Optical or magnetic rotary encoders usually determine their absolute position using a static reference point and the homing procedure at startup. The Electric Encoder is unique in being able to deliver a high-quality absolute position without the need for homing. It has more accurate motion detection even on multiple axes. Aside from those, it has better electronics integration due to the multiple output protocols and in case of power or system failures, it allows for better recovery.
source: https://netzerprecision.com/high-resolution-rotary-encoder/