Not with a VFD. You are talking about an AC servo and the encoders are specific to the motors/controller. DC motors are a LOT easier to use for position control, Simple optical rotary encoders and a decent DC servo driver and you have a closed loop system. You always have to worry about the "LOOP" (feedback loop) and position has to be stable and precise. Now if you just want speed control the VFD and encoder (or tach) feedback starts to make sense. It is used on things like spindles for constant torque/rpm. A good example would be to set the RPM of a lathe spindle to sync to the carriage feedrate to cut threads by measuring and adjusting the motor RPM. In that case one RPM is not a lot of error and the motor inertia and rather loose feedback loop to a VFD are okay. Go have a sit down with your control engineers and discuss closed loop control systems