It is just a plain old incremental encoder.
1) Feed its output to an encoder module.
2) Scale whatever your encoder count is to some nominal value for position.
3) Use your scaled position value for whatever you need.
4) Reset the position once per revolution based on a hard, precision, limit switch or the encoder's Z channel.
5) Try another approach, as this one may or may not work depending on the cycle time (speed) of the system, PLC, your program.
Honestly, this is one of those questions, if you have to ask, you aren't qualified to do it.